Preamble

The House met at a Quarter past Two o'Clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

WALLASEY CORPORATION BILL [Lords]

As amended, considered; to be read the Third time.

Oral Answers to Questions — BRITISH ARMY

Mr. Lawson: I am not aware that the A.E.C. officers are being employed in C.M.F. on duties unconnected with education. There are of course certain administrative duties in connection with this scheme.

Mrs. Manning: asked the Secretary of State for War if he is aware that in H.Q., B.A.O.R., the Army Education Scheme as set out in A.C.I. has been so emasculated, both in the spirit and the letter, as to cause discontent among men and women personnel; and will he cause immediate investigation to be made into


this complaint so that the grievance may be remedied.

Mr. Lawson: I am inquiring into this matter and will write to my hon. Friend.

Transit Camp, Folkestone

Lieut.-Colonel Mackeson: asked the Secretary of State for War if he will state the total number of all ranks involved in administering the transit camp in Folkestone; the maximum numbers accommodated in the camp during October; and if he is satisfied that it is more economical in overheads to have this camp located in scattered billets in civilian houses and hotels than to locate it in Shorncliffe Camp, which is two miles from Folkestone Harbour.

The Secretary of State for War (Mr. Lawson): Four hundred and forty-eight all ranks are at present employed; during October, the maximum number accommodated in the camp on any one day was 3,340, the total for the month being about 92,000. The camp is shortly being moved to Shorncliffe.

British General Hospital, M.E.F.

Squadron-Leader Segal: asked the Secretary of State for War on what grounds the use of physical violence by nursing orderlies at the psycho-neurotic centre of the 12th British General Hospital, M.E.F., has been permitted upon

patients who are convalescent from tuberculosis; whether he is aware that several patients have already had their tubercular condition aggravated as a result of their treatment at this hospital; and what has been the result of his inquiry into the allegations against this hospital, details of which have already been supplied to him.

Mr. Lawson: I am not aware that the conditions are as stated, but I have made inquiries and when the results are received I will write to my hon. and gallant Friend.

Personal Cases

Mr. Sparks: asked the Secretary of State for War whether he is aware that Marine Batson, CH/X 108132, escaped from the Stakehill military detention barracks on or about 28th October last; and whether he has since been recaptured.

Mr. Lawson: I am aware of his escape. No report of his recapture has yet been received by the War Office.

Mr. Sparks: Will the right hon. Gentleman suspend punishment of recaptured men pending the publication of the findings of the court of inquiry?

Mr. Lawson: That is another question.

Mr. Proctor: asked the Secretary of State for War if he will see that Private Greenwood, 14973322, is credited with his previous service in the Royal Navy for the purposes of demobilisation.

Mr. Lawson: This has already been done, and his release group correctly assessed. He forfeited a short period of service whilst in the Royal Navy. This has necessarily been excluded.

Mr. Sparks: asked the Secretary of State for War if he is aware that 7649588 Private Lynham was called to the Forces on 28th July, 1945, was accused of being a deserter since 17th October, 1940, and punished with 14 days' loss of pay; and whether, in view of the fact that the first notice this man received directing him to report for service was dated 20th July, 1945, and that he had been continuously employed for ten years previously by his employers who were engaged on vital war work, he will take steps to cancel this punishment.

Mr. Lawson: I am aware of this case. The soldier did not comply with an en-


listment notice ordering him to report on 17th October, 1940; it has been ascertained that this notice was correctly posted under the provisions of the National Service (Armed Forces) Act, 1939. He was ordered to join in July, 1945, following investigations, and did so. I see no reason to interfere with the award of forfeiture of pay for absence without leave, which was made in accordance with the appropriate section of the Army Act.

Mr. Sparks: May I ask the Minister if he is aware that this man did not receive the original notice of enlistment, that he was informed he had served 18 months in an Army Training Corps and six months in the Royal Army Ordnance Corps, and that he was a deserter from the Army when, as a matter of fact, he had not been in the Army at all and the first enlistment order he received was dated 20th July, 1945?

Mr. Lawson: All I can say is that in the circumstances I do not think this man got off so badly. [HON. MEMBERS: "Oh."] I will state the circumstances. I understand that it had been ascertained that the original notice was posted to him correctly. He elected to accept of his own free will the commanding officer's award of punishment rather than to go for trial by court-martial. He was awarded forfeiture of 14 days' pay for absence without leave from 2nd August, 1942, and in the circumstances he was not punished for desertion or absence without leave from the 17th October, 1940, to 1st August, 1942. His punishment for that period was barred by the Army Act. In the circumstances he elected to accept the judgment given.

Mr. Bowles: May I ask what proof is demanded by the Act of Parliament in question, and, in this case, what evidence was accepted as to who posted the envelope, and when, and where?

Mr. Lawson: That is a detailed question which, I think, would require a rather more detailed answer, and I would like to see it on the Paper.

Mr. E. P. Smith: Can the Minister say why these notices, which are rather important to the men concerned, are not registered?

Mr. Lawson: I believe, as a matter of fact, they are now, but I am not quite sure.

Mr. Sparks: While thanking the Minister for the reply, I would again like to ask if he is aware that this man did not receive his original notice of enlistment, that he did not attempt to evade service, that he was continuously employed by his employers who were engaged on important war work for ten consecutive years, and whether the Minister will not consider cancelling this punishment, which I think is most undeserved and unfair?

Mr. Lawson: In view of the facts of this case, I did investigate it to the best of my ability and I gave the answer on the facts supplied to me, but, if my hon. Friend desires it, and I would certainly desire it, I would like to discuss the matter with him so that he can put the matter in detail before me.

Lieut.-Colonel Sharp: asked the Secretary of State for War why 457963 Lance-Bombardier Gribben, No. 4 Liaison H.Q., British, B.A.O.R., was permitted to remain in the hospital of the Polish Field Ambulance, detailed to him by the hon. Member for Spen Valley, where sanitary conditions were deplorable, where there were no English-speaking personnel, and where he received no mail; whether Lance-Bombardier Gribben has now been removed to a British hospital and is receiving the treatment he requires; and if assurances will be given that British units will exercise proper supervision over the health and living conditions of men who are on detached service.

Mr. Lawson: This soldier was examined by a Polish medical officer, was admitted to the Polish Reception Station on 15th November, and transferred to a British medical unit on 3rd December. On transfer his condition was good, and he seemed to be quite happy. The sanitary condition of the Polish unit was good, but the food was not up to British standards. It is not always possible for soldiers in small detachments to be looked after by one of their own medical officers, but the Polish units have been asked to transfer any British patients as quickly as possible.

Demobilisation

Mr. Asterley Jones: asked the Secretary of State for War whether he is now


able to state the approximate dates of release of officers in Group 22 and subsequent groups.

Major Bruce: asked the Secretary of State for War whether he will state the reasons for the delay in demobilisation of officers in the Royal Signals falling in Groups 21, 22 and 23; whether he is aware that Royal Signals personnel in S.E.A.C. have recently had their leave stopped; and whether he is prepared to ensure that officers and other ranks in this corps are demobilised pari passu with those of other corps in the Army and that their normal leave facilities are granted them as in the case of other corps.

Mr. Heathcoat Amory: asked the Secretary of State for War whether he is yet able to give specific dates by which the various groups of officers who have been held back will be released, so that these officers may make revised arrangements for taking up their peacetime careers and re-establishing their homes.

Mr. Lawson: The revised dates for normal releases of officers are as follow: —

Group 21— Up to 9th January, 1946.

Group 22— 10th January to 24th January.

Group 23— 25th January to 19th February.

Group 24— Starting 20th February; to be completed at.a date to be announced later.

These dates apply equally to the Royal Corps of Signals. I have no information regarding the stoppage of leave of Signals personnel in S.E.A.C. I am prepared to investigate any particular complaint.

Mr. Jones: When will it be possible to announce the dates of release of officers in groups subsequent to No. 24?

Mr. Lawson: I should like to see that Question on the Order Paper.

Mr. Stephen: Will the Secretary of State arrange with the Minister of Labour to publish another edition of the Demobilisation pamphlet, so that, with these changes, it may be brought up to date?

Mr. Lawson: I will draw the attention of the right hon. Gentleman to that suggestion.

Major Bruce: asked the Secretary of State for War if he is aware than an order was issued in India Command in the first week in November that all demobilisation and repatriation of British personnel in the R.W.A.F.F. would cease until all the Africans had been returned to their homes; whether he will give the reasons for the issue of this order; and whether he has any further comments to make upon it.

Mr. Lawson: This matter has already been the subject of numerous Questions by hon. Members. I would refer my hon. and gallant Friend particularly to the replies I gave on 13th November to the hon. and gallant Member for Horn-castle (Commander Maitland) and on 4th December to my hon. and gallant Friend the Member for Cambridge (Major Symonds).

Major Boyd-Carpenter: Will the right hon. Gentleman say how long this is going on?

Mr. Lawson: As a matter of fact, these men are being repatriated now. There is no standstill, they are now being repatriated, and as far as these officers and N.C.Os. are concerned, I think most people realise that they are the leaders of the men and are necessary until the repatriation is complete.

Mr. Driberg: asked the Secretary of State for War if he is aware that a number of men in release Group 23, serving in a unit of B.A.O.R., of whose identity he has been informed, have been notified that they are to leave for home on 18th and 19th December; and if, since the journey to the United Kingdom customarily takes at least four days, he will cause the departure of these men to be so expedited that they will be released from the Army not later than 20th December, the date officially announced as the latest for the release of Group 23, and thus be enabled to spend Christmas at their homes.

Mr. Lawson: These men should be home by Christmas unless sailings have to be cancelled at the last moment, but I do not feel justified in taking special steps to get them home out of their turn.

Mr. Driberg: Is my right hon. Friend aware that they are not asking to be brought home out of their turn, but in


their turn, so that they can be demobilised with the rest of their group, and that they will not be home for Christmas unless he flies them home or takes some other special steps?

Mr. Lawson: I have stated that the men will be home by Christmas unless something unforeseen happens to the transport.

Mr. William Williams: asked the Secretary of State for War when he proposes to issue a statement regarding the release of members of the special communications unit, as promised in a letter dated 6th November, to the hon. Member for Heston and Isleworth.

Mr. Lawson: This question has been under consideration since the letter was sent to my hon. Friend. It has been decided that, since the need for them continues, the men must be retained either until they become redundant or until they qualify for release under the release scheme, whichever is the earlier.

Mr. Williams: Is my right hon. Friend aware of the serious concern felt by men in this unit regarding the constant chopping and changing in the conditions of demobilisation, and in the amount of gratuities and leave granted to them, and will he have special inquiries made?

Mr. Lawson: I am not aware of the facts stated. I will have some inquiries made, but these men are a special class. They will be released if they are redundant, but otherwise they cannot be released in advance of their group any more than other men.

Mr. Williams: Will my right hon. Friend say why they are being retained, because my information is that there is not very much work on hand at the present time?

Mr. Lawson: I will make inquiries on the point raised by my hon. Friend.

Squadron-Leader Sir Gifford Fox: asked the Secretary of State for War how many of the 10,000 agricultural workers to be given Class B block releases are to be taken from the Army; what conditions with regard to the age and length of service categories of these men will be applied; and how many men will be released during the next three months, respectively.

Mr. Lawson: I understand the Army quota is about 6,700. In selecting for bulk release the usual preference will be given to the earlier age and service groups but I cannot yet say how many groups will be affected nor how many releases will be made in each of the next three months. The latter depends largely on the numbers who happen to be serving abroad.

Mr. Janner: asked the Secretary of State for War whether British men compulsorily transferred from the R.W.A.F.F. to the Indian Army are outside the provisions of regulations for release from the Army.

Mr. Lawson: So far as can be discovered in the time available, no British Army officers or other ranks in the R.W.A.F.F. have been transferred to the Indian Army. Personnel of the Indian Army are dealt with under the Indian Army demobilisation scheme, and not under the Release Regulations.

Mr. Janner: Will my right hon. Friend see if he can expedite the release of these men in India in view of the very considerable dissatisfaction that prevails in respect to their present circumstances?

Mr. Lawson: I will note the suggestion made by my hon. Friend.

Lieutenant W. Shepherd: asked the Secretary of State for War why the release of officers of the R.A.P.C. is being deferred, despite the fact that in many offices their numbers arc increasing.

Mr. Lawson: Pay Offices are under very great pressure because of the mass of extra work thrown on them by the release scheme. Despite the efforts made to obtain suitable officers to cope with the extra work, and as replacements of those due for release, it has been necessary to defer release in some cases.

Lieutenant Shepherd: Is the right hon. Gentleman aware that those conditions do not obtain in certain offices of which I have knowledge, and will he take action if I give him information of specific cases?

Mr. Lawson: I am not aware of it, and I would be surprised if there was any slackness in these Pay Offices, because Pay and Records are kept fully employed in matters of demobilisation.

Colonel Stoddart-Scott: asked the Secretary of State for War if he is aware that the Horsforth Urban District Council are unable to commence their housing scheme of 144 houses until their two surveyors, Captain Dean and Lieutenant Marsden, are released from the Army; that in October the Minister of Health recommended the release of both men; if they are to be offered demobilisation under Class B; and when they are likely to be released from the Army.

Mr. Lawson: Both officers were in India. Release instructions were sent in October. I have no information as to the present position, but am making inquiries and will inform the hon. and gallant Member.

Disabled Personnel

Mr. Me Adam: asked the Secretary of State for War if he will review his decision not to release from the Forces men who have suffered permanent disabilities through wounds, such as the loss of an eye, and who will be entitled to disability pensions on discharge, as in the case of Trooper J. Bernardo, who lost an eye in Italy on 10th February, 1945, and who is now serving with N.A.A.F.I. in Austria after being posted from the Reconnaissance Corps to the R.A.S.C./E.F.I. be cause of his disability.

Mr. Lawson: No, Sir. It is still necessary to retain men who are below the highest medical category for certain types of work, and I am unable to make any exception in favour of the soldier named.

Aliens (Release)

Miss Rathbone: asked the Secretary of State for War if he is aware that distress has been caused to some aliens who voluntarily joined the British Army by a recent Southern Command Order to the effect that aliens who are not residents of this country when joining the British Army would not be released in their age and service groups; for how long the release of such aliens will be deferred; and whether, after demobilisation, they will be given the same opportunity as other aliens in the British Forces to remain and take up work in this country, and to be considered for naturalisation.

Mr. Lawson: As I have previously explained to hon. Members, soldiers are normally released in the country in which they enlisted, and I am unable at present

to make any exceptions in favour of men who claim that they intend to apply for naturalisation. The men concerned can be released under the ordinary rules as soon as their group is reached. Any delay is due entirely to their wish to remain in this country after release, a matter which is under consideration with my right hon. Friend the Home Secretary, in connection with his statement on 15th November.

Miss Rathbone: Is it not both ungrateful and short sighted, in view of the impending decline in our population, to put impediments in the way of men who served us voluntarily and now want to become citizens of this country?

Mr. Lawson: It is a matter on which I can do nothing personally. My right hon. Friend made a statement on this matter on 15th November to the effect that he was giving consideration to the matter.

Temporary Officers (Civilian Clothing)

Lieut.-Colonel Lindsay: asked the Secretary of State for War whether he is now in a position to announce the particulars regarding the entitlement of temporary officers to a civilian clothing outfit on leaving the Services.

Mr. Lawson: Yes, Sir. Such officers will now become entitled to the outfit, where eligible, if they ceased to draw Service pay on or after 16th October, 1944. An announcement to this effect, inviting applications from the individuals concerned, is about to be made in the Press. In the case of temporary women officers the same procedure will apply, except that they will receive the allowance of £ 12 10s. od. instead of a civilian clothing outfit.

Mr. Godfrey Nicholson: Why that particular date? Why was the line drawn there, because it is bound to cause some hardship?

Mr. Lawson: I understand that it was really a question of administration. The further you go back, the more difficult it is to get hold of the people concerned. It is partly administration and partly a matter of supplying the suits, which is a very great difficulty at the present moment.

Captain Crowder: Besides giving the announcement in the Press, could the Secretary of State arrange that the individual officers should be notified, as we are getting a lot of correspondence on this matter and the officers say they cannot get any satisfactory reply from their own Record Office?

Mr. Lawson: I said that an announcement to this effect, inviting applications from individuals concerned, is about to be made in the Press.

Captain Crowder: But cannot they be notified individually?

Mr. Lawson: I said so.

Mr. Lipson: Does the right hon. Gentleman not consider that equity should come before administration?

Mr. Lawson: I said it is a question of administration and production.

Coloured Soldiers (Discrimination)

Major Wyatt: asked the Secretary of State for War why orders were given that no coloured soldiers should be admitted to a military dance at the Slade Club, Abbasia, on Wednesday, 17th October; why a Jamaican lance-sergeant was turned away from this dance and insulted, although accompanied by two white other ranks; and whether he will give instructions that no further orders discriminating againstany coloured soldiers in His Majesty's forces shall be issued in M.E.F.

Mr. Lawson: I have called for a full report and will inform my hon. and gallant Friend of the outcome.

Letters to M.Ps.

Mr. Manning: asked the Secretary of State for War if he will make it clear that commanding officers of forces overseas are acting improperly when providing in orders that soldiers' letters to Members of Parliament have to pass through orderly rooms to be censored.

Mr. Lawson: There is no longer any unit censorship of soldiers' letters. If my hon. Friend knows of a case of the type referred to, and will send me particulars, I will have it investigated.

Mr. Manning: I am much obliged to the right hon. Gentleman.

War Decorations and Medals

Major Digby: asked the Secretary of State for War whether he is aware that the depots of certain regiments have still not received a proper supply of Army Form B2068, on which all applications for the Defence Medal have to be made; and whether he will expedite the supply of these forms, in view of the fact that the war in Europe ended nearly eight months ago.

Mr. Lawson: This form had to be revised owing to changes in the conditions governing the issue of awards, and it was delayed on that account. Distribution to Commands has now been completed.

Major Digby: asked the Secretary to State for War whether he is aware that the depots of some regiments have only just received a proper supply of Army Form B2070, which is necessary for applications for all campaign stars; and what is the reason for this and the consequent delay in authorising soldiers to wear the ribbons to which they are entitled.

Mr. Lawson: There has been no delay because of the fact that the relevant form was not available. Authority was given in June last for the issue of the campaign star ribbons on a provisional basis subject to verification later.

Education and Vocational Training

Flying-Officer Bowden: asked the Secretary of State for War why officers employed in the Army Education Corps in C.M.F. who are not being offered Class B releases, and are mostly schoolmasters are not being employed on E.V.T. but on administrative and staff work.

Oral Answers to Questions — Ordnance Depots

Mr. Manningham-Buller: asked the Secretary of State for War whether the decision to concentrate ordnance work at three large depots is based upon military or economic grounds.

Mr. Lawson: No decision has been given to concentrate the work at three depots, although it is hoped to concentrate it at about nine or ten, depending on postwar requirements. The depots are being selected on both military and economic grounds.

Mr. Manningbam-Buller: asked the Secretary of State for War the number of persons now employed at Weedon Ordnance Depot who will cease to be employed there as a result of the transfer of work from there to Bicester.

Mr. Lawson: The work of nearly 50 clerks is being transferred, but I understand that most, if not all, of those now employed on it have either accepted the offer of transfer to Bicester with the work or can probably be fitted into other posts at Weedon.

Mr. Manningham-Buller: Does the right hon. Gentleman appreciate that those who have been employed for so long at Weedon have been faced with the alternative either of unemployment or separation from their homes and families?

Mr. Lawson: I understand that a few of these men have resigned. It is not expected that there will be any difficulty in absorbing at Weedon those who wish to remain.

Mr. Manningham-Buller: asked the Secretary of State for War if he will state the number of houses it is proposed to build at Bicester to accommodate civilians transferred there from other depots.

Mr. Lawson: It is not within my province to build houses for civilian employees at depots, except for a few key personnel who must live on the premises. The civilian labour will be drawn as far as possible from neighbouring towns, but if any extra local housing appears to be necessary when the permanent establishment is fixed, I shall bring the point to

the notice of the civil authorities concerned. The accommodation of any transferred personnel will also be dealt with by the civil authorities.

Mr. Manningham-Buller: Is there any accommodation at Bicester for transferred personnel from Weedon, and are they now to be accommodated in a hostel on the site provided by the War Office?

Mr. Lawson: I could not answer that question, I should like to see it on the Order Paper.

Mr. Manningham-Buller: In view of the unsatisfactory nature of the reply, I beg to give notice that I will raise this matter at an early opportunity, I hope; on the Motion for the Adjournment.

Oral Answers to Questions — Tanks

Mr. Stokes: asked the Secretary of State for War whether he will now cause a full inquiry to be made into the whole question of tanks and tank production during the war and render a report to this House.

Mr. Lawson: No, Sir. As at present advised I see no advantage in an inquiry such as is suggested by my hon. Friend.

Mr. Stokes: May I ask the Tight hon. Gentleman whether he is aware that two reports have already been made to the Government which are so bad that they dare not tell the House of Commons; and is he not aware that, as a result of the gross inefficiency that went on, thousands of young men lost their lives and literally hundreds of millions of money was wasted, and will he reconsider the situation?

Lieut.-Colonel Lindsay: Is the right hon. Gentleman aware that the hon. Member for Ipswich (Mr. Stokes) was perfectly right in the representations which he made to the House on the subject of tanks, and that he performed a public service?

Mr. Lawson: I have nothing to add to the answer I have already given.

Mr. Stokes: In view of the very unsatisfactory situation, I beg to give notice that I shall raise this matter at the earliest opportunity in public.

Oral Answers to Questions — Hospital Cases (Terminal Leave)

Lieut.-Colonel Lipton: asked the Secretary of State for War whether soldiers


who, on account of war injuries have to enter military hospitals during their 56 days' terminal leave can have such leave extended by the amount of time spent in hospital.

Mr. Lawson: I am looking into this point and will inform my hon. and gallant Friend of the result.

Lieut.-Colonel Lipton: In view of the satisfactory nature of the reply I have received may I give notice, Mr. Speaker that I do not propose to raise this on the Adjournment?

Oral Answers to Questions — Battle Dress (Dyeing)

Mr. Garry Allighan: asked the Secretary of State for War whether he is aware that his Department prohibits discharged men dyeing the battle dress they are permitted to retain so that it can be used for civilian wear; and if he will have this prohibition withdrawn.

Mr. Lawson: Yes, Sir; it has now been decided that the ban should be lifted and arrangements will be made accordingly.

Mr. E. P. Smith: Does that apply to members of the Home Guard?

Oral Answers to Questions — Practice Firing, Norfolk

Mr. Gooch: asked the Secretary of State for War if he will order the discontinuance of the practice firing from ground artillery and anti-aircraft artillery range at Stiffkey over Wells, Norfolk, town, marshes and foreshore so that the townspeople, especially fishermen, worm diggers, cockelers and others can have free access to the marshes, foreshore and sea at all times.

Mr. Lawson: Firing by ground artillery will finish at the end of this month, after which only anti-aircraft practice will take place from this range.

Oral Answers to Questions — Jewish Personnel, Palestine (Posting)

Mr. Piratin: asked the Secretary of State for War whether he is aware that Jewish personnel in the British Army are being posted out of Palestine; on whose orders this is being done; and what steps he will take to end this religious discrimination.

Mr. Lawson: I am aware of this instruction. It was issued by the War Office in the interests of the soldiers concerned,

and it applies equally to men of the Jewish and Moslem faiths.

Mr. Piratin: Would the Minister explain to the House the reason for that instruction?

Mr. Lawson: I should have thought that was obvious.

Mr. Piratin: rose —

Mr. Speaker: Colonel Hutchison.

Mr. Piratin: Mr. Speaker, may I follow-up the question?

Mr. Speaker: I have called the next Question.

Oral Answers to Questions — Requisitioned Property

Commander Noble: asked the Secretary of State for War what are the units which are necessarily accommodated in London, thereby preventing the derequisitioning of premises in Chelsea.

Mr. Lawson: As the answer is necessarily rather long, I will, with permission, circulate it in the Official Report.

Commander Noble: Is the right hon. Gentleman aware that many of these premises are small houses which are in very great demand at present?

Following is the answer:

I assume the hon. and gallant Member does not want a detailed list of all the units— including many small detachments — which arc still accommodated in London. I can assure him that these units are under constant review to see whether their presence in London is still necessary. The major units in Chelsea are:

The Air Trooping Centre, London District Assembly Centre, War Office M.T. Company, a Military Collecting Unit, Leave Hostels, Camp Reception Station and various A.T.S. units employed in London District and at the War Office.

Essential work now being carried out by the units in London includes repair of bomb damage, removing air raid protections, assisting the General Post Office, erecting prefabricated houses and work for the community at large in addition to finding staffs for air trooping, leave and transit centres, and the several Military Headquarters whose units are still maintained in London.

Oral Answers to Questions — Personnel, Burma(Repatriation)

Mr. W. Williams: asked the Secretary of State for War whether he is aware that in six weeks preceding the 22nd November, no releases under Python or L.I.A.P. had been effected; that in that period not a single boat had left Rangoon with release men and that the catering arrangements in Camp No. 5 F.A.R.H.U. are inadequate and unsatisfactory and have resulted in an outbreak of dysentery in the camp; and what steps is he taking to remedy these conditions.

Mr. Collins: asked the Secretary of State for War if he will state the reason for the withdrawal of the troopships "Alcantara" and "Llangibby Castle" at Rangoon, with the resultant disappointment to British troops and to their families at home, who were relying on the pledge that they would be repatriated by Christmas.

Lieut.-Commander Clark Hutchison: asked the Secretary of State for War whether he is aware that at the end of November there were still many men belonging to release Group 23 who were held up at transit camps in and near Rangoon awaiting passage home; and what steps are being taken to speed up the repatriation of Army personnel from Burma.

Captain Chetwynd: asked the Secretary of State for War if he is aware of the unsatisfactory conditions of the repatriation camp in Rangoon, particularly in regard to food and water supplies; and if he will take steps to see that personnel awaiting transport are given as-good conditions as possible.

Wing-Commander Roland Robinson: asked the Secretary of State for War whether he is aware of the dissatisfaction among the men in No. 5 F.A.R.H.U. Camp, Rangoon, owing to the continued delays in their repatriation; and whether he will arrange for these men to return home as speedily as possible.

Mr. Lawson: As the answer deals mainly with points of detail, I will, with permission, circulate it in the Official Report. But, as regards repatriation from Burma in general, I have no reason to think that any substantial number of men will be delayed beyond their due

date, or that, even in cases where delay does occur, it will be for more than a few days.

Mr. Medland: Is the right hon. Gentleman aware that up to four days ago no boat had called at Rangoon, and will he fly these men home for Christmas?

Mr. Lawson: I do not understand the trouble about Rangoon at all. I have made special inquiries and I am hoping, according to the replies I have had from the Transport Department, that these men will be home in time according to the number of their group.

Mr. W. Williams: Will my right hon. Friend say whether, in the course of his inquiries, it has been confirmed or otherwise that no boat has left Rangoon for six weeks? That is the main point of our Questions.

Mr. Lawson: I have made inquiries upon this point and I am assured that these men will be home in time according to the group number.

Mr. Driberg: Could my right hon. Friend say whether as much transport aircraft has been used, proportionately, for flying home these men from Burma as for the men in India Command?

Mr. Lawson: From the answer that is being circulated, I understand that a ship left on 2nd December.

Mr. Driberg: Could my right hon. Friend answer the question which I have just put? Are as many transport aircraft used for the men in Burma as for the men in India Command, proportionately?

Mr. Lawson: I understand that they get their share of transport by air. They are sent to India for that purpose.

Following is the answer:

The "Alcantara" was suggested but was too big for this service and other shipping was provided. The "Llangibby Castle" was slightly delayed owing to essential repairs but sailed from Rangoon to the United Kingdom on 2nd December, less than a week after the due date. To offset any delay caused to men in early release groups, that ship was ordered to put in at Madras to take off any men who wished to travel the rest of the way by air. Subject to weather, men in Group 23 who travel by air should arrive home


within the prescribed period for release and even the remainder will not be more than a few days late.

I have made no specific promise that troops would arrive home for Christmas, though I hope many will do so. The statements as to progress and plans have referred to the end of the year. In the six weeks ended 22nd November, three ships left Rangoon for the United Kingdom bringing over 5,400 men, apart from any men leaving for home via India. I had already called for a report on the conditions in the repatriation camp in Rangoon, in connection with a previous complaint. On receipt of this report I will arrange for such remedies as appear to be necessary.

Oral Answers to Questions — Leith Hill (Restoration)

Mr. Touche: asked the Secretary of State for War whether he has considered the letter from the town planning committee of the Surrey County Council regarding the desirability of the restoration of the amenities of the preservation area around Leith Hill by the removal of temporary buildings and barbed wire entanglements; and what action is being taken.

Mr. Lawson: Yes, Sir. I have called for a full report on all the obstructions remaining in this neighbourhood so that the situation can be thoroughly examined.

Mr. Touche: Has any action been taken in this matter? I raised this question months ago.

Mr. Lawson: I will give the hon. Member an answer as soon as possible.

Oral Answers to Questions — Ammunition Dumps

Flight-Lieutenant Haire: asked the Secretary of State for War whether he will now remove ammunition dumps on agricultural land.

Mr. Lawson: As I have previously explained, very large stocks of ammunition are stored throughout the country and while every effort is being made to dispose of it as. quickly as possible, facilities for disposal are limited. Very little agricultural land is in use for this purpose and this consists entirely of headlands. Priority of clearance is being given to such land and the closest touch is maintained with local farmers.

Mr. Benn Levy: asked the Secretary of State for War when he will be able substantially to reduce the present term of overseas service for troops.

Lieut.-Colonel Sharp: asked the Secretary of State for War when he will relax the regulation that men in M.E.F. and C.M.F. must serve there for four years before qualifying for repatriation.

Mr. Lawson: I cannot at present add anything to the reply I gave to the hon. and gallant Member for North Blackpool (Brigadier Low) on 9th October, so far as length of the qualifying period for overseas service is concerned.

Mr. Levy: Can the Minister not even hold out some hope to these expatriates that somehow soon there will be a reduction?

Mr. Lawson: That suggestion has my sympathy, but I want to see the lower qualifications working properly before I make a decision, as I want to keep my promise when a decision is made.

Mr. Norman Bower: asked the Secretary of State for War why the 129th Field Regiment, R.A., has not yet been brought home, in view of the fact that the 36th L.A.A. Regiment, R.A., and the 123rd Field Regiment, R.A., which went out with them in the "Orion," in June, 1942, have both arrived in this country.

Mr. Lawson: Units move according to Army requirements but this does not affect the repatriation of individuals. A unit which remains overseas sends home individually any men due for repatriation. Such men have to be replaced. When a unit is no longer required and returns home it leaves behind any men who are not due for repatriation, for posting as replacements to other units. Both the field regiments mentioned are still in India.

Oral Answers to Questions — Searchlight Stations

Mr. Baldwin: asked the Secretary of State for War how long it will be necessary to retain 48 searchlight sites in the counties of Hereford and Worcester which have been unoccupied for from one to two years and for which compensation rent is still being paid.

Mr. Lawson: Three of these sites have now been released. Most of the remainder will be released as soon as satisfactory


arrangements can be made for the disposal of the hutting. These are proceeding and I hope that all will have been released by the end of January next.

Mr. Baldwin: Is the Minister aware that there was no hurry about the release of these sites until this Question appeared on the Order Paper?

Oral Answers to Questions — Requisitioned Property

Squadron-Leader Segal: asked the Secretary of State for War whether, in view of the proposal to revive the vicennial Preston Guild for the first time since 1922, he will undertake to restore to the county borough of Preston the use of its public hall within the next three months.

Mr. Lawson: This hall is used as an Infantry Records Office and is a vital part of the release scheme. I regret I cannot offer any hope that this property can be released within the next three months.

Oral Answers to Questions — Accident, Cambridge

Major Symonds: asked the Secretary of State for War if he has yet received the proceedings of the Court of Inquiry into the accident at Cambridge on 22nd October, when a civilian was killed in collision with a tank; and what action he has taken or intends to fake.

Mr. Lawson: No, Sir. I hope to have them within the next few days.

Oral Answers to Questions — Court Proceedings, Cambridge

Major Symonds: asked the Secretary of State for War if his attention has been drawn to the report of the proceedings at Cambridge Petty Sessions on 29th November, when the look-out man on a tank was fined £5 for procuring dangerous driving on 22nd October; and will he now give effect to the comment of the chair man of the bench that the Army authorities should make it quite clear whether they were going to take responsibility for such dangerous driving or whether they were going to make the men understand they must not do it.

Mr. Lawson: I have no information on the proceedings at Cambridge Petty Sessions, but I have called for a report.

Oral Answers to Questions — Drivers (Safety Precautions)

Major Symonds: asked the Secretary of State for War on what dates within

the last 12 months, and in what form, he has issued instructions that military drivers must at all times conform to normal traffic signals and road signs; and what penalties are imposed for breaches of such instructions.

Mr. Lawson: The instructions are brought to notice regularly each quarter, by Army Council Instruction, which provides for their repetition in summarised form three times a quarter in command, formation and unit orders. A court-martial in these cases may award as a maximum punishment either, in the case of an officer, cashiering, or, in the case of a soldier, two years' imprisonment with or without hard labour, or the punishment which under the civil law may be awarded for the offence.

Major Symonds: Is the Minister aware that these instructions are still not being observed, and that it was stated in the court proceedings referred to in the second part of my Question, that even in the town where this regrettable accident occurred these instructions were still not being observed?

Mr. Lawson: I have done all I can to emphasise this point upon the persons concerned. I may say that there was a detailed instruction sent out in 1942, and attention was drawn to this on 3rd March, 2nd June, 1st September and on the 1st of this month with instructions to the units who introduced the original A.C.I.

Mr. Stubbs: Can the Minister say whether local authorities receive information from his Department that the military authorities must obey the traffic regulations, and if not, why not?

Mr. Lawson: All I can say is that I have emphasised this matter as much as I can, and I cannot do any more than I have done.

Major Bruce: What action does the Minister take when cases come to his notice where the instructions have beer disobeyed?

Mr. Lawson: I have stated what the penalties are on the men who have disobeyed them.

Oral Answers to Questions — E.N.S.A. (Charges)

Mr. Gerald Williams: asked the Secretary of State for War on what basis it has been decided that, as from January


next, troops will have to pay sums varying between 6d. and is to witness cinema entertainments provided by E.N.S.A.; whether any estimate has been made as to whether such charges are necessary to cover the cost of the provision of the entertainment or whether a substantial profit is envisaged; and whether he will make a full statement on the subject.

Mr. Lawson: This represents a return to normal peacetime procedure. The charge is intended to cover the cost which, in the case of E.N.S.A. cinemas, at present falls on N.A.A.F.I. funds.

Mr. Williams: Is the Minister aware that these charges are very nearly as grave as those charged in this country after tax has been deducted, and is it right that these charges should be made to troops after already being subsidised by N.A.A.F.I.?

Mr. Lawson: I think I ought to make it clear that this arrangement does not at present apply to India and S.E.A.C. and only to the 35 m.m. films and not to the 16 m.m. films.

Oral Answers to Questions — War Department Constabulary

Mr. A. Edward Davies: asked the Secretary of State for War whether he will consider the abolition of the qualification for recruitment to the War Department Constabulary, that applicants should not be below the rank of war substantive sergeant in the Regular Army, so as to enable suitable applicants of all ranks to be considered.

Mr. Lawson: No, Sir, except for Regular soldiers of the Corps of Military Police, in whose case the rank of corporal is regarded as qualifying.

Mr. Davies: Is the Minister aware that there are many excellent men who did not attain the rank of war substantive sergeant in the Regular Army, but who could adequately fill these posts and should have some preference in recruitment?

Mr. Lawson: I am told that in actual practice and from experience it has been found that the rank qualification is an almost essential preliminary test in these matters.

Oral Answers to Questions — Far East Casualties (Notification)

Mr. Driberg: asked the Secretary of State for War if he is aware that, on the liberation of Changi Jail Camp, Singa-

pore, in August last, comprehensive lists of all those who had died in the camp were handed over to the British military authorities by the British personnel engaged regularly in the administration of the camp, but that in some cases the relatives of those whose names were in these lists have not yet been notified officially of their deaths and are only now learning of them informally from returning survivors; and if he will explain this delay.

Major Tufton Beamish: asked the Secretary of State for War on what date the detailed records, compiled at Changi throughout the Japanese occupation, of men who were killed in action in Malaya in 1941–42, or who died of illness in captivity, left Singapore by air; on what date the detailed list of casualties during this same period for Thailand, left Thailand by air; when these records arrived in this country; and why the next-of-kin of casualties recorded in these lists were in some cases still without information as to the fate of their relatives on 27th November.

Mr. Lawson: As the answer necessarily deals with several points of detail, I will circulate it in the Official Report.

Mr. Driberg: Can my right hon. Friend say whether he has really gone into this matter, because it has caused a great deal of distress among the relatives of the men concerned?

Mr. Lawson: Yes, Sir. I have given considerable attention to this matter.

Following is the answer:

Altogether, upwards of 400 lists of casualties have been received since the end of hostilities in the Far East, and without considerable inquiry I could not give the dates on which particular lists were despatched from Singapore or Thailand. The Changi records reached the War. Office on 16th November, having been preceded by numerous other individual and unit lists comprising much of the same information. All these lists have been or are still under examination at the War Office and very substantial progress has been made in notifying the next-of-kin. The lists vary very widely in their accuracy and in the details furnished, and in some cases considerable investigation is necessary before relatives can be informed. This, in conjunction with the large numbers involved, has affected to


some extent the speed of notification. In the great bulk of cases next-of-kin have already been notified, and I hope to deal with most of the remainder in the very near future, but hon. Members will appreciate that official notification cannot be undertaken lightly where discrepancies exist, particularly when they may be capable of clearance by further investigation.

Oral Answers to Questions — Personnel, Berlin (Entertainment)

Mr. Janner: asked the Secretary of State for War in view of the recent order banning British troops in Berlin from all German theatres and cinemas what arrangements are to be made to provide adequate alternative places of entertainment reserved for troops alone.

Mr. Lawson: The ban, which is not new, was imposed for medical reasons. Adequate entertainment facilities exist at two theatres— one a German theatre, with evenings for troops only— and seven cinemas. I understand that these are rarely completely filled. The troops also have access to American shows.

Oral Answers to Questions — Mails (India Command)

Lieut.-Commander Braithwaite: asked the Secretary of State for War what is the average time now required for the transit of mails from the United Kingdom to India Command.

Mr. Lawson: The average time taken between the base post offices in this country and India is 5.3 days by air and 29 days for parcels by sea. The time of transit between the base post office in India and the unit varies according to the unit location.

Lieut.-Commander Braithwaite: If I send the right hon. Gentleman information from the unit which alleges it has received no mail from home since 18th October, will he look into it?

Mr. Lawson: Yes, Sir.

Oral Answers to Questions — 271st Battery, Far East

Mr. Keeling: asked the Secretary of State for War whether he has considered the evidence sent him that the 271st Battery arrived from the Far East recently without adequate arrangements being made, either beforehand or during the succeeding five weeks, for proper housing, messing or winter clothing; and whether he has any statement to make.

Mr. Lawson: Yes, Sir. I much regret this incident, which was due to the very late arrival of information regarding the draft. The arrangements made were the best that could be improvised at short notice, but I realise that this did not prevent discomfort to the troops concerned. I am taking steps which I hope will prevent a recurrence.

Mr. Keeling: Does the Secretary of State not think that five weeks after the unit arrived is too long an interval before arrangements could be made?

Oral Answers to Questions — PRISONERS OF WAR

Distinctive Flash

Mr. Belcher: asked the Secretary of State for War if he will consider issuing a distinctive flash to repatriated prisoners of war.

Mr. Lawson: Flashes worn on battle-dress are regimental and not individual distinctions, but I am looking into the whole question.

Spanish Nationals

Brigadier Fitzroy Maclean: asked the Secretary of State for War whether he has yet reached a decision regarding the Spanish Republicans at present held as prisoners of war in this country.

Mr. Lawson: I hope to make an announcement within the next few days.

Brigadier Maclean: Does the Minister realise the great dissatisfaction that is being caused in wide circles by his failure to make up his mind on this question?

Mr. Lawson: I told the hon. Member that I will be in a position to make a statement on this matter within a few days, and I do not think it will be unsatisfactory, either.

Mrs. Leah Manning: Is the Minister aware that British intelligence officers recently visited the camp and took the names of men who wished to go to France, and told the other men, who did not want to go to France, that they will have to stay in the camp, and remain in this country? Was it on his instructions that this was done? It has caused very great dissatisfaction.

Mr. Lawson: That is rather a different matter. I should like to see that down


on the Paper. I must say that this question is extremely complicated and is not as plain—[Hon. Members: "Why? "] There are a good many sides to it and I am hoping the answer I will give later on will give a good deal more satisfaction.

Exchange Rates

Mr. Turton: asked the Secretary of State for War whether he is now able to announce any change of policy affecting the rate of exchange of charitable contributions made by officers and other ranks prisoners of war.

Mr. Lawson: I regret that I am not yet in a position to make any announcement on this Question about which I have been in communication with the hon. Member.

Mr. Turton: asked the Secretary of State for War whether he is now able to announce any change of policy affecting the rate of exchange of saving from pay received by repatriated prisoners of war who worked in the camps as batmen, orderlies or otherwise.

Mr. Lawson: Yes, Sir. Such savings are now being treated as savings of working pay and converted into sterling at the preferential rate of Rm.15 to the £.

Mr. Turton: May I ask whether other ranks should apply for the balance due to them, or will it come through the usual channels?

Mr. Lawson: I think I had better see that question on the Order Paper.

GALLANTRY AWARDS (FRENCH SUBJECTS)

Colonel J. R. H. Hutchison: asked the Secretary of State for War whether any King's medals for courage arid associated medals have yet been awarded to French men and women who aided our nationals during the German occupation.

Mr. Lawson: A list of recommendations for various awards, including the King's Medal for Courage in the cause of freedom, is now with the French Government, and we await their reply. Some awards other than the medal named have already been granted.

Colonel Hutchison: In view of the time which it has taken to reach this stage, may I ask the Minister whether we must

anticipate an equivalent lapse of time before these awards are finally made; and will he expedite the matter, because it is of real value between the two nationals?

Mr. Lawson: I take note of the point and benefit by it.

Air-Commodore Harvey: Could other countries, such as Holland and Belgium, be considered broadly in this list of decorations?

Mr. Lawson: I shall have to see that Question on the Paper.

NEWFOUNDLAND(ELECTED NATIONAL CONVENTION)

Mr. Maxton: asked the Prime Minister whether he is now in a position to make a statement about the restoration of self-government to Newfoundland.

Sir Alan Herbert: asked the Prime Minister what is the policy of His Majesty's Government concerning the future of Newfoundland.

The Prime Minister (Mr. Attlee): I propose, with Mr. Speaker's permission, to make a statement at the end of Questions.

Later—

The Prime Minister: In pursuance of the statement of policy made on behalf of the Coalition Government in December, 1943, which they fully endorse. His Majesty's Government have decided to set up in Newfoundland next year, as early as climatic conditions permit, an elected National Convention of Newfoundlanders. Elections to the Convention will be held broadly on the basis of the former Parliamentary constituencies. All adults will be entitled to vote, and candidates for election will be required to be bona fide residents in the districts they seek to represent. The Convention will be presided over by a judge of the Supreme Court of Newfoundland, and its terms of reference will be as follows:
 To consider and discuss amongst themselves, as elected representatives of the Newfoundland people, the changes that have taken place in the financial and economic situation of the Island since 1934, and bearing in mind the extent to which the high revenues of recent years have been due to wartime conditions, to examine the position of the country and to make recommendations to His Majesty's Gov-


emment as to possible forms of future government to be put before the people at a national referendum.
In order to assist the Convention, His Majesty's Government will make available to it when it meets the services of an expert adviser who could give guidance on constitutional forms and procedure; and they will also prepare for use of the Convention a factual and objective statement of the Island's financial and economic situation. This statement will be made available to Parliament at the same time.
In the meantime it is, of course, most important that the series of reconstruction measures which the Commission of Government already have in hand or are planning to introduce should proceed without interruption, and these will be pushed forward as rapidly as possible. The Commission have a full programme designed to meet the more pressing requirements of the Island over the next two or three years.
Our relations with Newfoundland have been so special and Newfoundlanders have played such a gallant part in the war that it would, I know, be the wish of us all to assure to any new Government which may take over in the Island the fairest possible start. But we must above all be careful not to promise what we may not be able to perform, and the special difficulties of our financial position over the next few years may well preclude us from undertaking fresh commitments.
The object of the procedure which His Majesty's Government propose is to enable the people of the Island to come to a free and informed decision as to their future form of government. I know the House, which has always been solicitous for their welfare, will wish them well in the exercise of their choice.

Mr. Eden: May I ask the right hon. Gentleman to accept the support of my hon. Friends on this side of the House in the step which he has just announced which, if I may so, seems a wise one in the interests of Newfoundland itself? We hope it will have the result we all desire, for we all feel a sense of gratitude for the contribution that that country has made during the years through which we have just passed.

The Prime Minister: I am grateful to the right hon. Gentleman.

Mr. Maxton: With regard to the Prime Minister's announcement, it seemed to me that it was the biggest blot on our democratic system that a nation that had self-government for many years should have it taken away. The Prime Minister mentioned that expert help would be sent out in the election of the Convention. Would he consider sending out now one or more additional Commissioners who would have the duty of assisting the islanders to prepare for the elections and the referendums?

The Prime Minister: I will certainly ask my Noble Friend the Secretary of State for the Dominions to consider that matter, but I would have thought they could have gone ahead with the election preparations. The kind of help which they need and which we intend to send to them is the technical help on. constitutional and financial matters and so forth. If there were any need for more Commissioners, we would certainly send them provided we could do so.

Sir A. Herbert: While thanking the right hon. Gentleman for his statement, may I ask him if he will congratulate not only the present Dominions Secretary but his predecessor on the very wise and generous announcement of policy which he has made?

Mr. Beverley Baxter: I am certain that the Prime Minister is aware that his announcement will be received with great satisfaction in Newfoundland. It is a matter of great credit for this Parliament. Can the right hon. Gentleman give an assurance that never again will any Government in which he participates—I know it was not done by a Government of which the right hon. Gentleman was a member —allow a Parliament to be closed down, and the franchise of a people to be taken away within the British Empire; and that whatever happens, never again will any British Parliament— [Interruption.] This matter is more important than procedure — [An Hon. Member: "It was a Tory Government that did it."] This is a very important matter. My point is that this country imposed taxation without representation. I want only an assurance from the Prime Minister that never again will that be done.

The Prime Minister: While I can certainly say that it is not the policy of this Government to take away representative institutions from any part of the British Empire, I am quite unable to pledge future Parliaments because Parliaments will do whatever they decide.

Captain Marsden: Is it not the case that Newfoundland, while still having full Dominion status, asked for our help? Do I understand the Prime Minister to suggest that if such a Dominion came again we should refuse that help? I should be very sorry to think that would happen.

The Prime Minister: I do not think it is a profitable thing at the moment to go into the history of this matter. We must look to the future rather than to the gloomy past.

HOUSE OF COMMONS DEBATES (RECORDING)

Mr. Gordon Walker: asked the Prime Minister if he will consider making arrangements for the recording of selected Debates in this House so that they may be later broadcast in part or in whole, by the B.B.C.

The Prime Minister: No, Sir. This proposal has been considered on previous occasions, and I do not think that there is any substantial body of opinion in the House which would favour this course.

Captain Blackburn: May I ask the Prime Minister whether the main reason why this proposal has been turned down in the past was not the low standard of Debate and attendance in previous Parliaments?

Hon. Members: Oh.

Mr. G. Walker: Would my right hon. Friend take into account that not only in this country, but abroad, many people are interested in our Parliamentary policy, and that this would be the most effective way of all of getting it across?

The Prime Minister: I disagree with my hon. Friend that this would be the most effective way of getting it across. I do not think that a long day's discussion in the House would be listened-in to. There would probably be a rush to get to the best listening times, which might affect the Debates in this House. It would be very difficult to get the proper balance

between Members. All those matters have been considered over and over again and I do not think it would be good to do it.

Mr. Baxter: Is the Prime Minister aware that his reply will be supported by all Members of good sense in the House?

ROSYTH NAVAL BASE

Mr. Kirkwood: asked the Prime Minister if he will consider giving time for a discussion of the Motion relating to Rosyth Dockyard, standing on the Order Paper in the names of the hon. Members for West Fife (Mr. Gallacher) and Dumbarton Burghs (Mr. Kirkwood).

[That this House is of opinion that Rosyth Naval Base should be retained and developed into a fully-functioning naval establishment and that consideration be given to the demand for a naval dock in the Clyde capable of docking the largest naval and merchant shipping built in the Clyde shipyards.]

The Lord President of the Council (Mr. Herbert Morrison): I regret that I cannot hold out any prospect of time being available for the discussion of this Motion.

Mr. Kirkwood: Is the Minister aware that discontent is rife in Scotland because we have no representative in the Cabinet, and that we are being neglected, with the result that there is more unemployment in Scotland than there is in England? What has the Minister to say to that?

Mr. Morrison: I can assure my hon. Friend that, in the regretted absence of the Secretary of State, Scotland has ample means of access to the highest quarters in the land. With regard to the idea of a Debate, I would suggest to the hon. Member that he might think of getting an opportunity on a suitable Supply Day when this subject might be discussed.

Mr. Gallacher: Is not the Minister aware that we have never yet got a day allocated for general discussion of the situation in Scotland? We are always limited to a Supply Day when we are confined to certain subjects.

Oral Answers to Questions — GERMANY

Hamburg (Military Government)

Mr. Pritt: asked the Chancellor of the Duchy of Lancaster for what reason the Military Government in Hamburg is


employing Lieut.-Colonel Herbst, a former Nazi Party member since May, 1933, to take charge of docks and water police in Hamburg; and if, as this individual falls within the category of C1 compulsory arrest or C1 compulsory investigation, he will give directions for his immediate replacement from among the available anti-Nazi Germans.

The Chancellor of the Duchy of Lancaster (Mr. John Hynd): Herbst is not employed with Military Government, Hamburg. He was dismissed on the 18th October, 1945, because he was within the compulsory removal category.

Mr. Pritt: asked the Chancellor of the Duchy of Lancaster for what reason the Military Government in Hamburg is employing one, Emil Kroger, formerly a Nazi Party member since May, 1933, a member of the S.S. and an official of the Berlin police up to the collapse of Ger many, to take charge of organisation and reconstruction in Hamburg; and if, as this man falls within the category of CI compulsory arrest or C1 compulsory investigation, he will give directions for his immediate replacement from among the available anti-Nazi Germans.

Mr. J. Hynd: Kröger is not employed with Military Government, Hamburg. He was dismissed on the 12th November, because he fell within the compulsory removal category. There is evidence that he was not a member of the S.S.

Lieut.-Commander Gurney Braithwaite: May I ask the hon. Gentleman whether the hon. and learned Member for North Hammersmith (Mr. Pritt) could be included in the compulsory category?

Mr. Pritt: asked the Chancellor of the Duchy of Lancaster for what reason the Military Government in Hamburg is employing Major Westring, a former S.S. Obersturmbannf ührer, as a section leader on the Staff in Hamburg; and if, as this individual falls within the category of C1 compulsory arrest or C1 compulsory investigation, he will give directions for his immediate replacement from among the available anti-Nazi Germans.

Mr. J. Hynd: Westring is not employed with Military Government, Hamburg. He was dismissed on the 12th November as he was found to have been a member of the Nazi Party from May, 1937, and a

member of the S.S. since 1940, with quick promotion between 1940 and 1943 and doubtful service in Austria and Russia. Before dismissal he was employed as a Section Police Officer in the Uniform Branch. He has since been arrested and has been prosecuted for wrongful completion of his Fragebogen. He was a Sturmbannfuehrer and not an Ober-turmbannfurhrer.

Mr. Pritt: Can the hon. Gentleman assure the House that persons of this character are being energetically chased out?

Mr. Hynd: I think that the answers I have given to the Questions put by the hon. and learned Gentleman are sufficient evidence. I can assure him that persons subject to compulsory arrest and compulsory removal are being speedily removed from the Services. In fact, all the higher appointments to the police made since the capitulation are again under review to ensure that none but anti-Nazis occupy these posts.

Military Organisations (Inter-Allied Inspection)

Mr. Pickthorn: asked the Chancellor of the Duchy of Lancaster what was the result of the discussions by the Allied Military Commission in Berlin of the Russian proposal for inter-Allied inspection of German military, naval and aviation organisations in the British zone; and whether he will give full particulars of such units.

Mr. Lipson: asked the Chancellor of the Duchy of Lancaster what formations of German forces and of German military, naval, and air force staffs sill exist in the British occupation zone; how many men are involved; what arms they possess; and when will they be completely and finally disarmed and disbanded.

Mr. J. Hynd: In reply to a Soviet suggestion that an Allied Commission of Inquiry should go into the British zone, Field-Marshal Montgomery stated that he was ready to agree provided that the Commission was allowed to visit all zones with equal freedom of movement and enquiry, and that similar Commissions were appointed to investigate other matters affecting the administration of Germany as a whole. After discussion, the Soviet proposal was referred to the Co-ordinating Committee composed of the four Deputies.
The Soviet proposal arose out of an allegation that the British authorities were maintaining Wehrmacht units fully armed in the British zone. The position is that some units and personnel of the former Wehrmacht have been retained for essential work, including dangerous tasks such as lifting mines. Others are awaiting transfer to the Russian and French zones. The shortage of British manpower due to the Release Scheme has made it essential to retain German staffs to see that British orders arc carried out. The rate of disbandment of these men and staffs depends on many factors such as the progress of the work and of the negotiations for transfer to other areas, as well as on transport facilities. These units have, of course, no armament. The total number of men involved is of the order of 520,000. Of former Wehrmacht personnel who fell into our hands at the surrender, some 75 per cent. have already been disbanded, and the process will be accelerated as much as possible during the coming months.

Mr. Lipson: Does the hon. Gentleman's answer mean that there are no German armed forces in the British zone?

Mr. Hynd: Certainly.

Major Peter Roberts: May I ask the hon. Gentleman if he will consider the advisability of going thoroughly into this question of investigation in all zones?

Mr. Hynd: As I have stated, the proposition was put by Field Marshal Montgomery to the Control Commission, and the whole question has been referred to the Co-ordinating Committee for examination.

Oral Answers to Questions — NATIONAL FINANCE

Defence Areas (Assistance)

Lieut.-Colonel Mackeson: asked the Chancellor of the Exchequer what steps the Government are taking to make it possible for traders, boarding house and hotel proprietors in defence areas to obtain adequate finance to reopen and re-equip their businesses.

The Financial Secretary to the Treasury (Mr. Glenvit Hall): I have been asked to reply. Loans free of interest are made by the Ministry of Health to local authorities in the coastal areas principally affected by the war to enable those

authorities to lend sums up to £150 to persons who were in business in those areas before the war. In addition, the ordinary facilities provided by the banks to their customers and, where somewhat larger amounts are involved, by the Industrial and Commercial Finance Corporation are available in suitable cases.

Lieut.-Colonel Mackeson: Will the hon. Gentleman give sympathetic consideration to increasing the sum of £ 150, which is quite inadequate?

Mr. Hall: This matter has been debated, and one cannot answer a question like that across the Floor of the House during, Question Time.

Colonial R.A.F. Personnel (Income Tax)

Mr. Driberg: asked the Chancellor of the Exchequer if he is aware that R.A.F. personnel who were recruited in the Colonies pay income tax to an amount not exceeding the tax which would be chargeable in their own countries, but that R.A.F. personnel from the Colonies who were recruited in this country pay income tax at full United Kingdom rates; that this discrimination operates harshly against those who volunteered for service early in the war and paid their own fares to this country in order to join up; and if he will take steps to alleviate this hardship.

Mr. Glenvil Hall: My right hon. Friend regrets that he cannot extend the concession to which my hon. Friend refers.

Mr. Driberg: Can my hon. Friend say why not?

Mr. Hall: Members of the Forces who come here from abroad are exempt from tax on the income that comes to them from the locality where they normally reside, but they have to suffer, as do other members of the Forces here, Income Tax deduction on pay which they receive from the British Government.

Mr. Driberg: But can my hon. Friend say why volunteers, who came here early in the war to join up on their own account, should have to suffer more than people who were recruited in their own countries? May I have an answer?

Mr. Oliver Stanley: Will the hon. Gentleman give an answer? It is very hard on some of these Colonial personnel


who made very great sacrifices to come over here.

Mr. Hall: That has been going on for six years, and up to July we had a Chancellor of the Exchequer who did not belong to the Labour Party. I think that it is rather late in the day to put this Question now that the war is over.

Ships' Masters (Income Tax)

Mr. Janner: asked the Chancellor of the Exchequer whether masters of Ministry of War Transport ships pay Income Tax on profits made by them on the sale of tobacco and bonded stores to their crews; and whether they submit detailed accounts of all such transactions on the completion of each voyage.

Mr. Glenvil Hall: Such profits, if made by a ship's master on his own account, are liable to Income Tax and should be included in his Income Tax return. The reply to the second part of the Question is that practice varies.

Mr. Janner: Will the hon. Gentleman be good enough to investigate cases where exorbitant charges have been made to see if proper returns are made in respect of taxes?

Mr. Hall: If the hon. Member will let me have particulars of the kind of thing that he has in mind, I will certainly look into it.

Mr. Janner: Would the hon. Gentleman be good enough to consult with the Minister of War Transport to whom I have given particulars of these cases?

Mr. E. P. Smith: Can the hon. Member say in what way this practice is carried on?

Mr. Hall: In some cases, the company owning the ship runs a shop aboard the ship, and the master sells tobacco and cigarettes as agent for the shipping company. In the case of some other companies, the master does this on his own, and accounts in his own way, if he makes a profit, to the Inspector of Taxes. I am informed that a very close watch is being kept.

Postwar Credits (Farmers)

Mr. Dye: asked the Chancellor of the Exchequer what regulations govern

the payment of postwar credits to farmers in respect of their E.P.T.; and whether the same regulations apply to tenant farmers as to owner-occupiers.

Mr. Glenvil Hall: The provisions contained in Part IV of, and the Sixth Schedule to, the Finance Bill. These apply to farmers, whether tenants or owner-occupiers, as to all other traders.

Mr. Dye: Is my hon. Friend aware that so far as tenant farmers are concerned, it is those who are well equipped with capital who have paid E.P.T., and therefore the condition that postwar credits should only be expended on further capital expenditure seems unnecessary and unfair?

Mr. Hall: Obviously if they had not been paying E.P.T. they could not get refunds.

Mr. Dye: I think my hon. Friend has misunderstood my question. The ones who have been paying it, so far as tenant farmers are concerned, are those who are well equipped with capital.

Mr. Hall: I am sorry. I do not understand the point.

Mr. Dye: Then I will explain the position to my hon. Friend later.

CIVIL SERVICE (EX-SERVICEMEN)

Lieut.-Colonel Sir Ian Fraser: asked the Financial Secretary to the Treasury if, when ex-Servicemen from the 1914–18 war become redundant in one Department of State, he will, by setting up a substitution board or otherwise, ensure them a preference for vacancies in other Departments.

Mr. Glenvil Hall: No, Sir. Arrangements already exist for transferring redundant staff from one Department to another wherever possible.

Sir I. Fraser: Does the hon. Gentleman's answer "No, Sir" imply that he is not going to give a preference to those men for continuous employment? Is that what he meant?

Mr. Hall: No, Sir. Ex-Servicemen, with others who are redundant, are transferred where that is possible.

Sir I. Fraser: Do they get a preference?

Mr. Hall: I said "No, Sir."

Hon. Members: Why not?

Sir I. Fraser: asked the Financial Secretary to the Treasury if, in view of the fact that temporary service in the Civil Service is allowed to count at half rate for pension in case of civilians, he will apply the same rule to ex-Service men of the last war.

Mr. Glenvil Hall: I regret that I cannot see my way to re-open this question.

Sir I. Fraser: Why the differentiation between ex-Service men, who do not get their service counted, and persons, mainly civilians, who after a certain date do?

Mr. Hall: I am afraid I cannot accept what the hon. and gallant Member says. This is an old story. It goes back to the last war. We have had numerous inquiries and commissions which have dealt with this. It is impossible at this stage to reopen the whole question.

Oral Answers to Questions — BRITISH BROADCASTING CORPORATION

Parliamentary Proceedings (Members' Broadcasts)

Dr. Santo Jeger: asked the Minister of Information whether his attention has been drawn to the non-factual broadcast on Parliamentary proceedings of the hon. Member for Daventry (Mr. Manningham-Buller) on 1st December last; and whether he will see that in future the impartial standard of these accounts of Parliamentary proceedings is maintained.

The Minister of Information (Mr. E. J. Williamsh): In the series ' The Week in Westminster ' Members of the main parties are invited in rotation to broadcast an account of the week's proceedings in which they have taken part. Arrangements for these broadcasts are entirely in the hands of the B.B.C. I am informed that the understanding between the B.B.C. and the speaker is that he should give a broad personal impression of what he heard and saw in Parliament, but should not use the opportunity to state the views of parties or individuals other than those which have been expressed in Parliament during the week.

Lieut.-Colonel Dower: Could the right hon. Gentleman state any fact which was stated in this broadcast which was inaccurate? Is he aware that Members on this side of the House thought that the hon. Member for Daventry gave a most favourable impression?

Captain Blackburn: Will the Minister at any rate recommend that these broadcasts should, so far as possible, be confined to policy rather than to personalities?

Mr. Maxton: Can the Minister tell us how Members who are capable of doing this are discovered? Are there employed, as by football clubs, persons who are known as "talent spotters "? I am aware of two eminent hon. Members who have been missed.

Mr. Manningham-Buller: On a point of Order. Is it not still the custom to give notice to a Member if one intends to make a criticism of his personal conduct? No notice was given to me.

Mr. Speaker: It appears in the form of a Question, that is the trouble. I think that the hon. Member might have been informed.

Mr. Nicholson: Is it not a fact that many broadcasts by Members on the other side of the House have been infinitely more biased? I cannot see any harm in bias.

Mr. Speaker: That is a long way from the Question.

Scottish Service

Colonel Gomme-Duncan: asked the Minister of Information whether, in view of the dissatisfaction in Scotland with the present system and quality of broadcasting, he will set up a Scottish board of directors for the control and development of this service in Scotland.

Mr. E. J. Williams: I understand from the B.B.C. that the Scottish Regional programme, which was restarted in July last, has been widely appreciated by Scottish listeners.

Colonel Gomme-Duncan: Is the Minister aware that he has been completely misinformed in this matter, and that the people of Scotland are highly dissatisfied with broadcasting as it is at present?

Mr. Williams: I gather that the people of Scotland are no more dissatisfied than the people of England or Wales.

Mrs. Jean Mann: Could my right hon. Friend say who in Scotland is satisfied with the B.B.C.?

QUESTIONS AND ADJOURNMENT MOTIONS (MR. SPEAKER'S STATEMENT)

Mr. Speaker: I have a statement to make. I have been asked to urge hon. Members to put down Questions for written instead of oral reply, when they refer to individual cases. This would enable more Questions to be answered personally by Ministers, which are of a more general nature or deal with matters of wider interest. It would appear that many Questions at present on the Order Paper could be dealt with equally well by correspondence with the Ministry concerned. I know that written replies are often not asked for, because Departments do not reply to these at once, because no time limit can be insisted on. I believe that fewer oral answers would be called for, if written answers could be dealt with more expeditiously.
I also propose that, when we meet again in the New Year, in order to enable as many Members as possible to have a chance in the Ballot for the Adjournment, any Member who has been successful shall not be allowed to ballot again for four weeks from that day.

TRUNK ROADS BILL

Reported, with Amendments, from Standing Committee D.

Bill, as amended (in the Standing Committee), to be considered upon Monday next, and to be printed. [Bill 48.]

Minutes of Proceedings to be printed.[No. 37.]

PUBLIC ACCOUNTS

First Report from the Committee of Public Accounts (with Minutes of Evidence and Appendices) brought up, and read; to lie upon the Table, and to be printed. [No. 38.]

MESSAGE FROM THE LORDS

That they have agreed to— Isle of Man (Customs) Bill, without Amendment.

Police (Overseas Service) Bill, and Statutory Orders (Special Procedure) Bill, with Amendments.

Police (Overseas Service) Bill

Lords Amendments to be considered upon Monday next, and to be printed.[Bill 50.]

Statutory Orders (Special Procedure) Bill

Lords Amendments to be considered upon Monday next, and to be printed. [Bill 49.]

BUSINESS OF THE HOUSE

Proceedings on Government Business exempted, at this day's Sitting, from the provisions of the Standing Order (Sittings of the House). —[The Prime Minister.]

Orders of the Day — FINANCE BILL

Order for Third Reading read.

3.28 p.m.

The Chancellor of the Exchequer (Mr. Dalton): I beg to move, "That the Bill be now read the Third time."
We are coming at last to the end of a long Debate on a long finance Bill, which contains 60 Clauses and 10 Schedules. It has been very amply discussed and I am sure that you, Mr. Speaker, and the House, would not expect me to go over the whole ground again. I think it will suffice if I pick out and emphasise one or two of the principal points of the Bill.
So far as indirect taxation is concerned, the Bill is chiefly occupied with the Purchase Tax and with motor taxation. With regard to the latter, I have reaffirmed in substance and recommended to the House the views formed by my predecessor. I undertook to keep my mind, at any rate half open, until the matter was further considered in Committee, but the discussion in Committee pointed to the view, and no Division was challenged on it, that, on the whole, the best plan was to adopt the proposed 100 cubic centimetre basis of taxation. That has been done. I hope that the industry, knowing where it is, will now get on with the job of producing motor cars, especially for export.
So far as the Purchase Tax is concerned, I haw felt able to make a first step towards the exemption of a number of the more necessary articles, a wide range of domestic cooking and heating appliances, and refrigerators. I have received from all parts of the House during the passage of the Bill a number of suggestions for further extensions of Purchase Tax exemption, but I have felt able to accept only one or two—wireless sets for the blind, and certain articles connected with war memorials and intended to be used for that purpose. I was very glad to make

these exemptions, which were particularly desired. The time is not ripe for me to move much further with regard to Purchase Tax remission, but I have undertaken to consider, and I will consider, between now and April, all the many suggestions that have been made for further extension. I hope that it may be possible then—I make no commitment—to go further along this particular road.
With regard to direct taxes, the discussion in the House and in Committee has mainly centred on the Income Tax and the Excess Profits Tax, possibly somewhat to the neglect of a number of other useful and important Clauses of a non-controversial character contained in the Bill, particularly those relating to double taxation which we hope to abate, and to the fixing of the appointed day under the Income Tax Act, 1945, which brings considerable reliefs and advantages to many Income Tax payers, particularly in business. These Clauses have not been subjected to-much discussion but that very fact indicates that all parts of the House have favoured their passage into law. We have had rather more discussion on the Excess Profits Tax to which the House will not expect me to add. The Finance Bill has also provided a number of Income Tax reliefs as from next April, such as the standard rate; the new two-tier arrangement reducing that standard rate of Income Tax at the lower level of incomes; and the new Surtax scale. These are the principal taxes affected, but, in addition, we have had long discussions on postwar credits in many aspects. It was generally accepted that these should cease at the end of this financial year, and after full discussion the House has approved the majority of my proposals without substantial amendment.
I do not think that the House will wish me to cover again the old ground of earned income allowance and kindred matters. I would merely repeat in one sentence that there was never any commitment, that any Chancellor of the Exchequer would reconstitute exactly, the allowances as they were when the late Sir Kingsley Wood introduced the postwar credits-system. It was always assumed, and rightly so, that the Chancellor of the Exchequer of the day would be reasonably free to make adjustments as between one allowance and another. The Leader of the Opposition said the other day


during the Debate on the Motion of Censure that hon. Members opposite were out to do the greatest good to the greatest number. I have tried to do this in this Budget. I have tried to follow the right hon. Gentleman's precepts in dealing with Income Tax and that is why I thought it better to clear 2,000,000 people entirely from taxation, and for the rest to provide relief which, even allowing for the postwar credits, give to 11,750,000 people more relief than they would have got under an exact reconstitution of the 1941 allowance. I have said this myself about half a dozen times, and it has been expressed by others at least as often. The fact remains that, under these proposals, everybody is going to have a larger net income next year, than they would otherwise have had, and I think that has met with general satisfaction. That is a matter of fact which no sophistry can bypass.
With regard to Excess Profits Tax, it is very essential that industry, in reconverting to peace, should be assisted as much as is reasonably possible having regard to our commitments. That is why it seemed particularly important to stimulate exports. To do this, I have reduced the Excess Profits Tax in this, the first Budget in this new Parliament, to 60 per cent. and have made provision for the refund of 20 per cent., as the House well knows. We have had some discussions of a very interesting character as to the way in which we shall ensure that these refunds shall be used for the purpose for which my predecessor explicitly intended them—namely, to re-equip and build up businesses, and not merely to increase dividends or give short-term and immediate advantages to shareholders. We have considered at some length in this House all the necessary provisions and I think they will be found to be watertight and efficient. If, however, on re-examination, they are found not to be so, I shall always be willing to reconsider any of the details in order to see that we achieve exactly what is intended.
This Bill brought forward within three months of VJ-Day, is, as I said when introducing it, only the first instalment of our peacetime financial programme. Within the limits of what it is wise to do just now, it has emphasised the importance of stimulating production in every possible way. Within the limits

of prudence I have endeavoured to give all the relief possible to taxpayers, but in the next Finance Bill to be introduced, according to the passage of the months, very soon—in April probably—a further advance may be possible along these lines where we have already made a beginning. It is, as I said when introducing my Budget, only the first step of this journey, and I ask that the Bill should be judged in this light.

3.38 p.m.

Sir J. Stanley Holmes: It was generally agreed that, when the Chancellor introduced his Budget on 22nd October, it had a good reception and a good Press. I think possibly there were a good many people in the country who felt there was nothing exceptional about it but, to use the words which the Prime Minister used just now with regard to Newfoundland, it was on constitutional lines and procedure and those people who are going to get some relief from it are, naturally, pleased. I think too, that throughout the Debates a pleasant atmosphere has been created by the Chancellor himself but as time went on— rather dully as I thought through the Committee and Report stages— I could not help feeling that there was far more disappointment about the Finance Bill which has now been completed, than there was about the Budget when it was first introduced.
I venture to suggest that the Chancellor was so pleased with the response to his Budget, that when he went back to the Treasury he ordered a rubber stamp with the letters "No" on it, so that whenever he got, from time to time, an Amendment or a new Clause proposed he simply took his rubber stamp, used it, and then handed over the Amendment or new Clause to the appropriate Treasury official in order that the necessary information by way of reply might be furnished to him, or to the Financial Secretary to the Treasury. He has himself told us today that all the relief that he gives in this Finance Bill, is to the direct taxpayers. That, if I may say so, seems contrary to all the best precedents, and to the policy of his own party They have always argued that everything should be done by direct taxation, and that indirect taxation should be reduced to a minimum.
Of course it was impossible to increase direct taxation. That had already been done by Lord Simon and by the late Sir


Kingsley Wood, who had imposed on the direct taxpayers the highest possible taxation which was of any value to any Chancellor Therefore, it is quite understandable that the Chancellor, in this Finance Bill, must first reduce direct taxation. But it docs seem to be unfortunate that he was not prepared to give a little relief in one or two ways to the indirect taxpayer. I want to refer in the first place to a new Clause, which was put forward with regard to the Entertainments Duty. This was to relieve amateur sport from a certain amount of the Entertainments Duty.

Mr. Speaker: I would point out to the hon. Member that he is out of Order in talking about these things on the Third Reading, because they are matters which are not included in the Bill.

Sir J. Stanley Holmes: With due deference, Sir, I would point out that these are in the Bill. What I would like would be to sec them taken out of the Bill. These sports clubs arc being taxed by this Bill. I think it is unfortunate that that is so, and I hope the Chancellor will certainly consider between now and April, if he can do something about this Entertainments Duty which is paid by the amateur sports clubs. There arc other people besides direct taxpayers —

Mr. Speaker: I think the hon. Member is putting the cart before the horse. He is saying that these things are being taxed, and therefore are in the Bill, and that they should not be taxed. It is not a point that can be made on the Third Reading, and is, therefore, out of Order.

Mr. Oliver Stanley: Further to that Ruling, Mr. Speaker, would it be in Order, as the taxation is in the Bill, to address the House on the point that it is pressing on the clubs, and should be removed?

Mr. Speaker: The point is that to do that would require amendment of the Bill under discussion, and that, as I have indicated, is out of Order.

Sir J. Stanley Holmes: Perhaps I may test the matter once more by referring to what appears to me to be another unfortunate fact, and that is the Tea Duty, which is being continued at the same rate as last year. The relief in direct taxation has been given almost entirely, if one

might say so, to the male population. After all, it is the man of the family who gets the Income Tax relief, even if his wife has an earned income —

Mr. Speaker: I think I could not have made my Ruling quite clear. The hon. Member is now talking about taxes which are already in previous Acts. He cannot talk about taxation which is in other Acts, and which has not been affected by this Bill, because in order to secure his point that would mean amendment, and it is for that reason that he cannot talk about it now. What he has just said comes under the same Ruling.

Sir J. Stanley Holmes: Then I must confine myself to saying that the whole relief has, in effect, been given in direct taxation, and it seems unfortunate to me that there has not been some relief in indirect taxation, and that something has not been given to the housewives who have at least borne six years of a very hard life, and have done it very bravely. There should, too, have been a certain amount of relief granted in indirect taxation, which would have given the boys and girls a chance for games and for physical recreation which have been largely denied to them during the past six years, and which they may not be able to get for some years yet. I feel that what is disappointing in this Finance Bill is the fact that so little money is being saved between now and the end of the financial year. The hon. Member for the Scottish Universities (Sir J. Anderson) when he opened his Budget in April last put down his expenditure as £5,565 millions for the year 1945–46. The Chancellor of the Exchequer has told us that he is going to reduce that expenditure by £ 90 millions between the time he took over and the end of the present financial year.

Mr. Speaker: I must remind the hon. Member that we cannot discuss expenditure on the Third Reading of a Finance Bill.

Sir J. Stanley Holmes: May I then add that I hope, at any rate, that when the Chancellor opens his Budget next April I shall be more fortunate in regard to keeping within Order, and shall have the opportunity of congratulating the Chancellor on having enormously reduced the expenditure of the country for the next year.

3.46 p.m.

Mr. Alfred Edwards: I want to address myself to two items in the Bill, and if I survive as long as the last speaker, I think I shall succeed in getting over the point which I want the Chancellor to bear in mind. I refer to Clause 3. I congratulate the Chancellor—I think that would be a safe way to start—on adopting the capacity tax in place of the old horsepower rating. This is a tremendous advance, which I think will help the motor industry, although I regret that he did not go further. Our main purpose is to help the export trade, and I am not satisfied that, by the concession he has made, British manufacturers will be able to get as large a share as they are entitled to in the export market. If he had adopted the idea put to him in Committee, he might have enabled the designers of cars to have absolute freedom of design to help them in their competition with America. I hope that, between now and his next Budget, he will lend an ear to those people who have advice to tender to him, because I think he has missed the one opportunity that any Chancellor has ever had, to free the designers of motor cars in this country and, moreover, to put the money which he receives from the tax where it belongs— the Road Fund. The Road Fund was raided, and the money taken away, in a very dishonest manner, and the time is coming when, if the Chancellor continues to raid that Fund, the safety of the nation will be imperilled.
I had better get on to my next point, which concerns the Excess Profits Tax. Once more, I congratulate the Chancellor on reducing the tax to 60 per cent., and I would remind him again that, had he accepted advice, he would have removed the inequalities by which so many small people are paying tax today in order that big business may save some direct Income Tax. His own explanation was that if we helped the small people the larger people would have to pay more Income Tax. Of course they would; there is every reason why they should, too. During the past years the small business people have had no chance to get into production in competition with the big business men, and I hope that in his next Budget the Chancellor will take another look at the Excess Profits Tax and abolish it altogether. The other item is

the Purchase Tax. I am sure the right hon. Gentleman does not receive from the Purchase Tax anything like the amount he imagines he is getting. Nobody will buy a motor car today. People have to satisfy themselves with what they have, and I think the Chancellor is getting precious little out of Purchase Tax, while at the same time, he inputting a tremendous handicap on business. He would be well advised to abolish the, Purchase Tax on motor cars and give industry a chance to survive.

4.50 p.m.

Professor Savory: I was present in the old House of Commons, sitting under the Clock, when Sir William Harcourt introduced his famous Budget in 1894. That is now well over 50 years ago and I have rarely missed since that date hearing the Chancellor open his Budget. If listening to Budget statements makes one a financier, I have surely by this time begun to qualify. Of all the Budgets I have heard I am bound to say that this one has caused me the gravest possible misgiving, on account of the very great seriousness of the financial situation, and I strongly object—and here I am sticking very closely to the Bill—to the Seventh Schedule to the Finance Bill. I strongly object, at a time like this when the nation is faced with such a financial crisis, to this immense remission of taxation, and especially to the remission of Income Tax. The Chancellor has stated that these remissions amount to no less than £322 million, and he has boasted that 2,000,000 people who formerly paid Income Tax will not now pay it. I believe that the broader the base of taxation,' the better it is for the people, and perhaps I might be allowed to give a personal reminiscence in this connection.
Before the last war I was lecturer on the English language and literature in the University of Marburg, Prussia, and I received the magnificent salary of £75 a year. There was at that time in Germany a "pay as you earn" system. At the end of the first month the porter brought me the few marks to which I was entitled, and in great fear and trembling, and with every kind of polite circumlocution, I pointed out that I thought he had made a slight mistake, as I seemed to be short of a few marks. He replied, "The bursar of the University of Marburg never makes a mistake. You have


forgotten the Income Tax." With a salary of £75 a year I had to pay Income Tax. Anyone with an income of 1,000 marks a year— that is to say £50— had to pay Income Tax. In this Bill it is now proposed to raise the exemption limit from £110 to £120, with an immense loss of revenue.
I want to give the reasons why I oppose this Budget on its Third Reading, and the reasons are these. I would ask the House to contrast this remission of £322 million of taxation with the fact that the food subsidy has now risen from £200 million to the staggering figure of £300 million per annum. I would ask the House to contrast the gigantic total of the food subsidy with the fact brought out in this Budget that, if everything were taken after taxes from incomes in excess of £2,000 per annum the Chancellor would only gain £60 million. I feel I cannot insist too often on the fact that there is now—and I would call the attention of our hon. Friends opposite to this—no such thing as an unlimited pool of wealth in the hands of the rich upon which the Chancellor can continue to draw. No, you have already killed the goose which formerly laid the golden eggs.
The latest figures showing the financial position of the country are given in Command Paper 6709, published on 6th December, 1945. We there learn—and I am opposing the recklessness of the Budget on these grounds—that the net income from overseas investments in 1945 will be less than half of that received in 1938. Almost all the marketable United States' dollar securities of United Kingdom nationals were complsorily acquired for sale in order to finance the purchase of munitions.

Mr. Speaker: These arc considerations which should have been put forward on the Second Reading. Such considerations are now completely out of Order on the Third Reading.

Professor Savory: I should like to have your guidance, Mr. Speaker. Am I not allowed to give the reasons why I am opposing this Budget on the Third Reading?

Mr. Speaker: If the hon. Member's reasons are to be found inside the Finance

Bill, yes; if they are all over the place outside the Bill, I am afraid, no.

Professor Savory: I would like to point out that I am opposed to this remission of taxation on account of the very precarious state of our finances, and I wish to give various figures showing how precarious those finances are.

Mr. Speaker: All that hon. Members may discuss on the Third Reading is how money is going to be raised, not how it is going to be spent or how serious our financial situation may or may not be. Those considerations are quite out of Order on the Third Reading of the Finance Bill.

Mr. Oliver Stanley: Would it be out of Order to call attention to the fact, for instance, that in one's own opinion the Finance Bill proposes to raise too much money, and point to the disastrous consequences which that might have on the national finances?

Mr. Speaker: I do not think we ought to go very far in that direction. That would be really becoming a Second Reading Debate and not a Third Reading Debate.

Professor Savory: I shall obey your Ruling, Mr. Speaker, and adhere to my very strong objection to this enormous remission of taxation. We are now informed, for the first time, of the fact that the total United Kingdom losses of national wealth are of the order of £7,300 million, and the most serious feature of this is that the newly created external liabilities amount to £3,455 million, to which the Chancellor yesterday added another £100 million, incurred during the period between 31st July and 30th September. We also learned that on the basis of a £75 million deficit in 1946 it would not be safe to base policy on the assumption of a further deficit of less than £500 million to provide for the two years 1947 and 1948. This leaves us with a cumulative deficit which will be of the order of £1,250 million, or even higher.
In order to meet this deficit the Chancellor has insisted, and everyone knows that it is essential, that we should increase our exports. I find that, assuming the volume of our exports in 1938 to be represented by 100, our exports were only 29 in the first nine months of 1944, and 42 for the first nine months of 1945.Let


us just take a few figures, and I am sure this is relevant to the Budget. In the first nine months of this year we only exported 262 motor cars instead of 33,000 in the corresponding period of 1938. India and Australia only got one motor car each. During the same period we exported only 90 gramophones as compared with 31,000 in the corresponding period of 1938. Again we exported only 13 pairs of silk stockings instead of 63,000 pairs in 1938.

Mr. Speaker: The hon. Member cannot discuss questions of silk stockings at the present time. He is getting very far away from the question of the Third Reading of this Bill.

Professor Savory: I must apologise. I am just coming to my conclusion. With this serious financial background in view, I should like to read the fine words of the Chancellor of the Exchequer in opening his Budget. I shall abbreviate in order to save time. He said:
 The Committee may take for granted that next year there will be increased expenditure, both to extend social services and to carry out a number of other constructive tasks. Family allowances will begin to be paid next year. …Increased old age pensions and other improved benefits will begin to be paid. … There will also be increased expenditure on housing, on education … and expenditure on Colonial Development and welfare.

The Chancellor concluded with this most eloquent passage:
 To do all these things and to do them well, as part of a coherent plan, steadily accomplished stage by stage during the lifetime of this Parliament—such shall be our aim, such shall be our pledge and our pride. We shall do these things." —[Official Report, 23rd October, 1945, Vol. 414, c. 1885.]
No, Mr. Speaker, they will not do these things because before they attempt half of them, they will be brought up by the threat of national bankruptcy. They are living in a fool's paradise. This rake's progress will bring them to a catastrophe even worse than that to which they brought the country in 1931, when a blow was struck at British credit from which it has never recovered. Do they suppose that this extravagant expenditure is going to be financed by the Debt which they are about to contract in the United States? Congress is restive at the thought of being obliged to provide for wildcat Socialist expenditure over here. I implore the Chancellor in the interests of

the country to draw back before it is too late and save this country from the financial abyss in which he is about to plunge her.

4.3 p.m.

Sir Arnold Gridley: We have had a light touch introduced into this Debate, but I am feeling a little anxious, lest I trip over some of the boulders that lie in the path of those who speak on the Third Reading of the Bill, and I hope that I shall not make it necessary for you, Mr. Speaker, to rise during the few minutes I propose to occupy the time of the House. I should like to say, first, that, on the whole, the Chancellor has met us on this side of the House fairly well. We have by no means got all we had hoped to get, but, on the other hand, I am not sure that we should have been justified in expecting that we should get all we had hoped to obtain. Still, I think I can say that industry does feel that he has, to some extent, followed in the footsteps of his predecessor and that he did go a very considerable way, by changes in taxation, to facilitate the postwar development of industry and accelerate postwar employment, which we are all anxious to further to the utmost of our ability.
One matter which we discussed under Part V of the Bill was double taxation. I raised the point during the Debate on that Clause which the Chancellor promised to consider. I think he agreed with me that we have not succeeded in carrying out the intentions which lay behind these double taxation Clauses. Let me give a concrete example; probably there are many like it. I know of a big undertaking in this country in which half the capital is owned in America and the remaining half is divided into three parts and is held by three great undertakings in our Colonies and Dominions. America holds one half and these other undertakings hold the remaining half between them. What happens is this. The company here in England makes profits and distributes dividends to its shareholders, and the dividends on the American capital go out to the U.S.A. after being taxed. They form out there part of the income of the American company, in which there are a considerable number of British shareholders by reason of the capital structure which I have described. The profits made by the American company come back to


this country, to the British shareholders, and are taxed. There you have a case of double taxation which is not yet met. I agree that it may be rather complicated to remove this double liability, but it is a case, I think, which the Chancellor would be justified in looking into further.
I would like to say a word next on the discussion we had yesterday on the year 1945, which the Chancellor is adhering to as the date from which these E.P.T. refunds may be used for postwar purposes. The Chancellor of the Exchequer has a great many things to look at between now and next April. It was suggested by my right hon. Friend the former Financial Secretary to the Treasury, or perhaps it was my right hon. Friend the former Secretary of State for the Colonies, that the Chancellor would have a great many Christmas cogitations, and I am not sure that he will not have a great many Spring chickens; but the Chancellor will have a good deal to. think about, in connection with the many points raised during the Committe stage and on Report, between now and next April, and I would ask him when he is applying his mind to the Clauses we discussed last night whether he will consider this: Industrial undertakings, as the Clause stands, will not be allowed to bring into refund account for the purposes of postwar development expenditure prior to April, 1945. I think I am right in that. If the Chancellor adheres to his proposal will he not be imposing considerable injustices on other firms who have carried out expenditure for precisely similar purposes but at an earlier date, very frequently because they have been asked or urged to do so by Government authorities, and sometimes partially with Government financial assistance? We may create considerable anomalies between one firm and another if the year 1945 is adhered to. Therefore, I ask the Chancellor to look at this matter again. I think it was not one of the cases to which he promised to give re-examination, but he has frequently told us that he keeps his mind flexible on many of these matters, and I suggest that flexibility might be applied here. That is all I want to say on the Third Reading, and I would repeat, although not everyone will agree with me, that I do feel the Chancellor has gone a good way to meet us on this side and T thank him for it.

4.12 p.m.

Mr. Warbey: Not being an experienced Parliamentarian, I fear that I cannot hope to avoid the manifest pitfalls of a Third Reading Debate, but I shall rely upon you, Mr. Speaker, to pull me up very gently, and very firmly, if and when I do transgress. I wish to refer to something which is in the Bill and has already been mentioned: the proposal to introduce a cylinder capacity tax on motor vehicles. Like the hon. Member for East Middlesbrough (Mr. A. Edwards) I hope that the Chancellor will regard this as a transitional measure for the transitional period through which we are passing from a war economy to what we hope will be a normal peace economy. There is a very unusual feature about this tax. It is not purely a fiscal one. It is not a question simply of raising revenue, of distributing reliefs and incentives, but it is a tax which, by its form, has a very special effect upon engine design and, therefore, upon the capacity of a whole industry not only to meet the needs of the home market but also to make a contribution to our export trade. At present the form of tax probably does not make a lot of difference, because in the export trade we have a sellers' market, but that state of affairs will only last for perhaps a couple of years, and after that the motor industry must know what is the form of tax on which they are to base their decisions in regard to design and other matters affecting their permanent export policy.
I believe they are prepared to make their contribution, but I suggest to the Chancellor that he should, in view of the special effect of this tax, set up a small committee of experts to examine its effects and to make recommendations to him for a possible revision. The Committee might consist of economists of automobile engineers, of persons with general experience in the trade and manufacturing industry, and, of course, of other persons who have not a special interest in this particular industry. That committee, which might be set up possibly in collaboration with the Board of Trade, would be in a position to investigate the effects of the tax and the various proposals made by the manufacturing interests and by the consumers, and then to report upon the probable effects of this tax, or other forms of tax, upon the trade, upon our home market and, above all, upon our export trade. I hope the


Chancellor will consider this suggestion seriously, because in his hands lies a great power—by his decision about the form of this tax—to influence employment in a very important industry.
It is an industry employing scores of thousands of workers and in my own constituency directly or indirectly affecting the welfare of probably one-third of the population. I hope the Chancellor will review this matter in the light of the national interest rather than as a result of ex parte statements and bargaining which are probably not the most satisfactory method of arriving at a conclusion on a matter which so much affects the country as a whole, the interest of the workers, and the balance of our foreign trade.

4.15 p.m.

Major Peter Roberts (Sheffield, Eccles-all): I would like to have an assurance from the Chancellor of the Exchequer that one small but very important point is covered in the Bill. Will the Chancellor give an assurance that the Bill covers the 20 per cent. refund of Excess Profits Tax to colliery companies and other companies which are to be nationalized, and therefore, will be unable, because of what the Government have done, to put back that money into the re-equipment of their business? By Clause 38 (1, a) the Government will become the person who will Te-equip the industry, and therefore they will obtain the right to purchase by compensation or other methods from the colliery companies, the road hauliers, and so on, the right to the 20 per cent. refund in order to re-equip the business and get it going. The Chancellor will appreciate that a large amount of money is involved. To put the matter bluntly, will the Government get the right to put the 20 per cent. refund Excess Profits Tax into the businesses which they take over, or will those businesses be deprived of that amount, and if so, will the compensation be payable to the owners concerned?

4.17 p.m.

Lieut.-Colonel Sir Walter Smiles: I want to raise one matter, and in doing so I shall try to avoid being called to Order by you, Mr. Speaker. I had intended to raise the matter yesterday, but unfortunately the 'plane from Ireland came down in a fog near Chester

instead of at Croydon, and I did not have an opportunity of raising the matter during the Report stage. I wish to refer to the Purchase Tax as it affects churches. A great many churches had some of their vessels destroyed in the blitz. When they replace those vessels, they will have to pay the full Purchase Tax on them. I have sent papers on this subject to the Financial Secretary, whose replies to me have been very sympathetic, but he has not given me any satisfaction. I put it to the Chancellor that when a church has to purchase a piece of silverware, which is clearly a work of art and which will never be resold again, he might take the opportunity of excluding that article from the Purchase Tax in future.

4.19 p.m.

Sir Peter Bennett (Birmingham, Edgbaston): I wish to support the plea that was made by my hon. Friend the Member for Stockport (Sir A. Gridley) to the Chancellor to consider, between now and the next occasion on which he introduces a Budget, the point that has been made about the hardship imposed upon people who started reconstruction work before April, 1945. I raised this question in the days of the right hon. Gentleman's predecessor and obtained from him a promise that those industries which had already started reconstruction would have their postwar credits allowed against the work they had already put in hand. The Chancellor took that point up, and has given us the Clause which makes it clear that this will be allowed, but he has inserted the date when I brought the matter up— April, 1945. From that date onwards he will honour the promise that was made. When I raised the matter, however, I pointed out that the reconstruction had already started..
I feel that the Chancellor is taking rather a positive stand in this matter, whereas we feel that he should take a negative one—a rather unusual request from us. When the late Sir Kingsley Wood promised that these postwar credits would be available in certain conditions, he approached the matter from a negative point of view. He said there were certain things which must not be done with them; they must not be used for paying dividends or for bonus shares. Industry has always felt that as long as that was not done, they would be allowed


to use the postwar credits in the process of developing their business. During the war, certain companies have made alterations, at the Government's suggestion, knowing that those alterations would help in the postwar period. Now the Government say that those companies have to spend the little capital that is coming back to them on doing all that over again. The firms want the money now to pay the extra cost of their stocks caused by the change in money values. They want it in order to have extra working capital, which they will need. I ask the Chancellor to reconsider this matter, and to see that people who have already done the work are not handicapped in this way.
We also asked the Chancellor whether he could not enable industrialists, as they spend that money, to have a simple means of obtaining a certificate from the Inland Revenue that they were inside the regulations and not to have any sort of contingent liability overshadowing them. Probably the Chancellor will think this is a matter which can be done by administration. Last night the Financial Secretary said that the door must be left open to chase people who do things which they ought not to do. I am certain the Inland Revenue have all the powers they need to do that. The large majority of people arc honest and straightforward. They do not want to have contingent liabilities. I hope the Chancellor will find a way in the regulations to enable people to rule their accounts off and to know that, unless something very unforeseen turns up, the accounts are finished.
I appreciate the point that was made in an earlier Debate by the hon. Member for West Coventry (Mr. Edelman). I appreciate the point he was making of the great value of the motor industry to this country, but I do not feel that the Chancellor needs any more committees to advise him. The question is in his hands. He has told us that he wants the present amount of taxation. In the years to come, or in the months to come —we prefer the shorter period to the longer—when the Chancellor has reached the stage at which he does not need the same amount of taxation from the country and is prepared to reduce the amount which he asks the industry to put into the Exchequer, that reduction will be better than any committee, and will enable

the motor car designers to design larger cars, because the public will be in a position to buy them. That is the whole point. The matter is in the Chancellor's hands. He gave us a hint, when he answered my right hon. Friend the Member for West Bristol (Mr. Stanley), that these taxes are not like the laws of the Medes and Persians, and that the day may come when he will be able to do a little more to help the industry by way of a reduction in taxation. That is the time to which we are looking forward. That is the only thing which will enable the industry to produce larger cars in quantity, because people will be able to afford to buy them. This will give us the output, and enable us to sell more cars abroad.

4.25 p.m.

Mr. I. J. Pitman: I wish to raise two points. According to Clause 15, the allowance for lower taxation ceases at £125, so that the full rate of tax of 9s. starts at £125, whereas under the old rate the reduced allowance of 6s. 6d. continued up to £165. The effect of this is that £40 of the earlier income of the workman will come on to the higher rate sooner. I deplore that. I think it will have a very discouraging effect upon working men, and particularly upon over-time earnings, that, at an earlier stage of their excess income over their allowance than in the past, they will have to pay the high rate of 9s. instead of 6s. 6d. I think the Chancellor of the Exchequer is under the impression that he can put that right in the Income Tax tables by some dodge, but I think I am correct in saying that differences in the gradation of rate of that kind cannot be coped with by the existing P.A.Y.E. tables, and that any attempt to put this right would have to be done by considerable notice in advance. Therefore, I ask the right hon. Gentleman not to wait until April to put right what I think many of us consider to be a very unfair and wrong part of this particular taxation proposal.
The other point with which I want to deal has reference to Clauses 38, 39 and 40, dealing with the treatment of Excess Profits Tax refunds. I very much agree with my hon. Friend the Member for Edgbaston (Sir P. Bennett) when he says, in effect, that this country is most fortunate in having a first-class Inland Revenue Department and a


first-class set of companies who, between them, collect and pay up tax on an astonishing scale. Credit is due to both sides, and it is by co-operation and respect from the Inland Revenue to the companies and from the companies to the Inland Revenue that that good result is achieved. I very much fear—in fact 1 can safely predict—that the effect of the uncertainty and, as I see it, the misconceptions underlying Clauses 38, 39 and 40 will be very damaging to this mutual co-operation and respect and so to the country in the long run. Those Clauses are based on a major misconception, which, I suspect, has already been found out in another connection, namely, that you cannot put your finger on one of a number of sixpences that are handed over to somebody and say to him that one of those particular sixpences shall be used for one particular purpose only. One of the detailed misconceptions is on the question of bonus shares. Bonus shares are not a distribution. If a company has £40,000 in the bank and gets an Excess Profits Tax refund of £10,000 it then has a cash balance of £50,000. If it capitalises that as a bonus, that is the only way in which within the existing law the objective of the Chancellor and of the House can be achieved; that is the only way in which to ensure that the amount permanently remains part of the capital structure of the company and so permanently undistributed. There will be in the coming years many occasions on which there will be perfectly good bonus issue stories. I have been looking very closely into the matter and I cannot find a bad bonus issue story.
I cannot understand what is worrying the Chancellor and hon. Members opposite. The fact is that bonus issues of capital against a refund tie up the money so that it cannot be used for distribution. It becomes part of the capital structure of the company, and cannot be distributed. This inquisitorial panel, or approving panel, can hardly be called an advisory panel, because its functions, as defined in those Clauses, appear to be to inquire and approve. The setting up of that and above all, the wide open door which these Clauses give to people to get round them, is something which is most damaging to the tax structure of this country. I very much deplore those particular Clauses.

Viscount Hinchingbrooke: The Chancellor of the Exchequer always succeeds in introducing into our Debates a very happy atmosphere of generosity and accommodation but invariably his genial demeanour is accompanied by sedulous refusal of most of the concessions for which we ask. Today I notice, with some regret, that his characteristic friendliness does not extend as far as good manners. I have not been long in this House, but I always thought it was the custom of the Chancellor, when winding up on the Finance Bill, to pay some tribute to his hon. Friends who have sat through the Debate and borne the heat and burden of the day. The Financial Secretary opened the Second Reading Debate with a wholly admirable speech. He subsequently sat here through the long Debate on the Committee stage and when we asked him to intervene and give us a concession he got up, said "No" nicely and sat down again. Likewise the Solicitor-General has greatly distinguished himself during the Debate. He gave us long and learned disquisitions on the state and operation of the law, for which we were grateful. It seems to me that both hon." Gentlemen deserve some meed of praise from the Chancellor and in the absence of it, it perhaps falls to me, as a humble Member of this House, to express our thanks to them.
I join with my hon. Friend the Member for Queen's University, Belfast (Professor Savory) in deploring the fact that the Chancellor has excluded 2,000,000 persons from the taxation system of this country. Hon. Gentlemen opposite invariably express the utmost keenness about subjects which concern political education. It will not redound to their credit in the end that they have been associated with a Measure which excludes from taxation altogether a large part of the community. The Chancellor nods his head. He apparently agrees with me. If that is so why has he done it? Is it not good policy to demonstrate to the people of the country by practical, direct taxation that they have some responsibility, however slight, for the expenditure which is involved in providing them with security and with the many services they now enjoy? It is wrong and unwarranted of the right hon. Gentleman to associate the exclusion of those 2,000,000 people with a remark passed by the right hon.


Gentleman the Leader of the Opposition when he said that everything should be done for the greatest good of the greatest number My right hon. Friend was speaking in another connection altogether —on demobilisation. I regard it as absolutely deplorable and a piece of popularity-seeking of the most short-sighted kind that the right hon. Gentleman has thought fit to exclude these classes.
Let me say a word in regard to earned income relief. It is astonishing to find the Socialist Party emerging as champions of the rentier. I always thought that they disliked inherited wealth. Many hon. and right hon. Gentlemen opposite come from the professional classes. A great part of their political doctrine is built up on dislike of the rentier class, which to them is something of a parasite in industry. Why is it that we have not had the distinction between entrepreneur and rentier drawn by hon. Gentlemen opposite? Is it because they have suddenly become altruistic about themselves and their profession and do not wish to push their type forward? I cannot believe that this is the case. The Chancellor has admitted in his speech on Second Reading that taxation bears hardly on enterprise. It is the enterprise of these professional men that we sorely need today and it is wrong and even stupid, to put them into the same class as people who receive their income from unearned sources. I hope that in the course of the next six months, when the Chancellor has had an opportunity to think out the whole matter again he will consult his hon. Friends from the professional classes and will make us some concession in the Budget next year. I turn to the Surtax provisions, which I regard as a profound mistake.

Mr. Jack Jones: Before the hon. Member leaves the question of. advocating that the very poor should pay tax —

Viscount Hinchingbrooke: I left that point some time ago.

Mr. Jones: The hon. Member is advocating that they should have a stake in the country be it ever so small. Would he tell the House how he ties it up with the poor not having to do at all with small savings?

Viscount Hinchingbrooke: Perhaps I may develop that argument on a later

occasion. I am not sure that on the Third Reading of the Finance Bill, the discussion of small savings would be in Order. But perhaps I may avail myself of the interruption to give due warning that some of us on this side of the House will raise the subject of the organisation and direction of savings when the Motion to extend the National Loans Act is taken after the Budget next April.
I was speaking about Surtax. When the scales of Income Tax were raised during the course of the last 20 years it was always argued by successive Chancellors that it was right that Surtax should be proportionately higher. The principle was established that if another shilling was put on the Income Tax scale, then the Surtax payer should pay something in excess. But the moment that the present Chancellor sees fit to reduce Income Tax, he abolishes that principle altogether. He says, "No, we will make a concession to the Income Tax payer, but the Surtax man can stay exactly where he is." I dub that as class legislation of the worst order. The result of it will be felt by the country to an increasing extent as time goes on in lack of enterprise and enthusiasm, and in suspicion of the motives of the Labour Party.
One of my hon. Friends on this side of the House said the Chancellor had been accommodating. He has to the extent of forgoing Purchase Tax on wireless sets for the blind and on war memorials in churches. But scarcely more than that During the last few days on the Finance Bill we on this side of the House have been seeking for concessions of all sorts and kinds for the hard-pressed people of this country and we have been met with stolid refusal. We have asked for remission of entertainment duty. There was the suggestion made yesterday for the re-equipment of hotels. We asked the Chancellor to extend the housekeeper's allowance, likewise to raise the children's limit from £50 to £60; again with regard to a constant medical attendant. On whisky we asked for a concession and the Chancellor refused it; we asked for the repayment of postwar credits for pensioners and that was refused; we asked for greater earned income relief and for the reintroduction of the 1940 Surtax rates to which I have referred. There was a whole series of technical Amendments associated with


the name of my hon. Friend the Member for Stockport (Sir A. Gridley) for the benefit of industry and for the most part they have been rejected.
What has been the main ground for this wholesale refusal? It has always been that it would add to the danger of inflation. I do not know whether anybody has attempted to sum up the cost of the concessions which have been asked for on this side of the House, but if they amounted to a tithe of what the Chancellor is himself spending at the moment, I should be amazed to find it so. He is spending money at the rate of £5,500 million a year. He goes so far as to say that there will be some reduction of that expenditure over the next few months but will not give us the information in the House as to what the extent is to be. In so far as there is a reduction in what he is spending is it not the very reverse of inflationary and are we not justified without being charged with inflationary intentions in asking for some concessions to be made against falling State expenditure? The danger of inflation is caused by the aggregate of Government and private spending. Given that the right hon. Gentleman himself cuts down his expenditure which he intends to do, is, indeed, compelled to do, he can well allow Members of the public to spend an equivalent amount without increasing risk of inflation. If we are not in a dangerous position today as regards inflation then we should be in no worse position if the right hon. Gentleman had pointed to his own reducing: expenditure and given us the concessions we asked for in the name of the public.
Under this Government at the present time the power of choice of the individual is dangerously limited. In so far as we can get concessions on this side of the House for the ordinary taxpayer freedom of choice is increased and that would benefit the entire country. The Chancellor is using this colossal weapon of taxation and, as I said the other day, what practically amounts to enforced loans to create a dull uniformity in the country. It is encouraging the black market. There is no doubt whatever that while State expenditure remains high and while that is used to establish the kind of principles which are adhered to by the party opposite the black market in this

country will flourish exceedingly. One of the main ways in which the Chancellor can do away with the danger of the black market is to reduce, his own expenditure and allow greater freedom of choice to the public. If he does that, he will be adopting a course which is wise and right.
I think that this is a bad Finance Bill. I think that we have not been well treated on this side of the House. I urge the right hon. Gentleman to consider well whether he cannot himself introduce next April some of the numerous suggestions we have put to him in recent Debates. If not, I believe he will meet with more determined opposition than he has yet had.

4.44 p.m.

Mr. Oliver Stanley: In the early part of this afternoon, under the strict guidance of Mr. Speaker, this appeared to be less of a Debate than an attempt to journey between Scylla and Charybdis, a passage which was only successfully negotiated by the Ulysses from Ulster, who appears to be so fatigued by the effort that he has now had to retire. It is inevitable that we should discuss the concluding stage of this interim Finance Bill in rather an unreal atmosphere. Normally, of course, the Finance Bill is by far the most important financial Measure of the year. To a great extent, as it is good or bad, it will determine our economic prosperity. In this case, these matters we are discussing today, important as they are, appear insignificant, compared to the matters of immense moment which this House is to proceed to discuss in the next few.days—matters of vast implication which may render all the Chancellor's efforts nugatory.
There is, in regard to this Budget, this additional difficulty—that it is not this year's Budget that we are really discussing. We are really discussing next year's Budget on this year's figures, and that, of course, does create a considerable amount of difficulty, because, in fact, we have not been able to have, during these Debates, any estimates such as we should normally expect of expenditure or income relating to the year in which this taxation is going to take effect. With all those difficulties, we have had discussions which I would not say were long. The right hon. Gentleman referred at the beginning to "long discussions on the Budget." I think, thanks to our spirit of co-operation


and willingness on this side, the right hon. Gentleman will find that they have been really considerably less than precedent. I should have expected, if the right hon. Gentleman had been distributing gratitude to anyone, that we should have had a word of thanks for the willing assistance we have given. I cannot agree with one hon. Member who spoke from these benches that, so far as we were concerned, these discussions have proved particularly fruitful. It is true that, in the last stages, we did wring one or two drops of blood out of the stony heart of the Chancellor, and there was just an airy hint that we might ask again some time before next April. But when it came to his able assistants, the Financial Secretary and the Solicitor-General, we never got anything, I think, from them at all. In the hardness of their hearts, they very much belied their kind and, indeed, benign exteriors.
The main objection that I have to this Bill is that it is difficult to relate its individual provisions to any one central economic theme. I am not going to deny that this Bill contains many concessions which will be welcomed after six years of strenuous sacrifice by a large number of people, but it does seem to me that the pattern of the right hon. Gentleman's Budget is a Victorian pattern—a Gladstonian pattern. It is an attempt, out of the money that the right hon. Gentleman has available, to dole out to the taxpayers whatever little personal assistance he can give them, having always in mind, of course, the consideration that the taxpayer is also the elector. I had thought that, at this period of our economic history, we should have had, instead of that, a Budget which was definitely and solely related to increasing the production of this country and restoring its industries. After all, it is on that, that the individual happiness and welfare of everyone is going to depend, rather than on a present of £1 here off the Purchase Tax or of £2 there off the Income Tax. That is what is going to decide the economic future of this country. That is going to decide the standard of life of the people; that is going to decide the rate of taxation which the Chancellor will have to impose.
I find this Budget singularly deficient in a connected theme of that kind. Let me give one or two examples. Take first

the motor tax. I am not going to say that the right hon. Gentleman, faced with a choice between two ways of raising this taxation, has not in this Bill chosen the better of the two it appears to be the one preferred by industry. But no one can pretend that the treatment of motor taxation in this Budget has any real connection with the motor car industry, as one of our major exporting industries in the future. No one can pretend that this Bill really represents an effort by the Government to use the taxation of motor cars to establish the motor car industry as a great weapon in our export trade. Similarly, when we come to the earned income allowance, I cannot conceive how we can relate the necessity of stimulating production, initiative and energy with selecting, as the one class to be penalised —in proportion, let me put it—by this Budget those whose incomes are derived from labour, energy and efficiency. I am not going into the old arguments which we have had on many occasions. Although the Chancellor has returned different replies, on this point they have been, to my mind, invariably unsatisfactory. The right hon. Gentleman will agree that, whatever else has happened under this Budget, the relationship between earned income and unearned income has been upset, and it does seem to me extraordinary that a Budget devoted to production should have made that quite radical change in recent tax history.
Finally, there is, of course, the question of the Surtax. I am still waiting to hear from the Chancellor—I may hear in the last few minutes from the Financial Secretary—what incentive to production, what economic gain, what additions to trade are to be expected from imposing another £7,000,000 upon the Surtax-, payer. I shall be interested to hear how that can be justified by the right hon. Gentleman, on the sole basis on which, I believe, a Measure of this kind should be justified today—that it will increase our power in the markets of the world.
There is only one Clause in the Bill to which I want to refer particularly, and that is Clause 28. It is a Clause on which we have had some discussion. It deals with the question of deficiencies of profit occurring after the end of 1946. I feel here that a strong case was made that the date chosen, if not too early for the majority of cases, may prove too early for some. The right hon. Gentleman did give


some hope that, between now and April, he would look into this matter again, not with a view to extending the date, but of seeing if there was not some way in which hard cases could be dealt with. I hope that, by that date, the right hon. Gentleman will be able to find some relief for them.
As one of my hon. Friends said, we have had to conduct the whole Debate upon this Measure under the threat of inflation. The right hon. Gentleman was able, at every inconvenient turn, to invoke in his assistance this terrible spectre of inflation. Apparently, Providence has willed it that the danger of inflation ceases at exactly that amount of tax relief which the right hon. Gentleman has decided to give, and that, if he were to exceed it by as much as an electric tea-kettle or a piece of wallpaper, we should fall immediately into the abyss. Of course, he would agree with me that the point at which inflation becomes a danger is not a static one. it can be moved forward or backward, and it can be moved, to a great extent, by the action of the Government. It is because of that, that the actual contents of this Bill are almost unimportant compared with the two great factors which are going to influence this policy—the rate of national expenditure and the rate of industrial reconversion. I know it would be out of Order to discuss, in any detail, these two points, but of this I am certain—that the whole task with which the right hon. Gentleman will be confronted in April, when he will have to give these figures, will be dominated by the success which he and his colleagues are able to achieve, in the intervening months, on these two great problems.
I did say something on the question of expenditure at an earlier stage, and I was reproved—by the hon. Member for Wellingborough (Mr. Lindgren), I think, in a military simile, which did not, perhaps, seem to suit him very well—for attacking the right hon. Gentleman opposite with a pea-shooter, because I had insisted that the main task was the elimination of these small items of waste. I still believe that to be true. I still believe that it is the man still in the Army when he need not be, the house requisitioned by a Government Department when not really wanted, the factory not released because of inertia on the part of a Gov-

ernment Department—it is these things, multiplied 10,000 times, which are really braking the Chancellor's progress I am sure we can rely on him to cause a real drive against what has become the vested interest of the individual Department.
The other factor was the factor of re-conversion. To me, one of the poignant features in the Debates on this Bill was a little speech by the hon. Member for Elland (Mr. Cobb), who, in a pathetic voice, asked why our industrialists could not turn over as quickly as those of America, and if we had not better take a lesson from her. Look at the difference. Our unfortunate industrialists cannot even blow their own noses without asking the permission of the President of the Board of Trade, and, before he gives it, the right hon. Gentleman has to consider, first, whether the handkerchief is not wanted for the export trade.
Then he has to ask the ideological Brahmins of the party opposite whether, in a planned economy, it is after all right for anybody to blow their own nose, or whether it would not be better that somebody should blow it for them. When the answer comes finally, even if it is favourable, the unfortunate man is already dead of pneumonia—gone by a happy release to a land free of catarrh and of controls. [An Hon. Member: "What do they do in America? "] If I am allowed to say so, in America they are allowed to blow their own noses as and when they like.

Mr. Deputy-Speaker (Mr. Hubert Beaumont): The right hon. Gentleman must confine his remarks to the Finance Bill.

Mr. Stanley: I naturally thought, Mr. Deputy-Speaker, that as you did not rise to prevent the hon. Gentleman asking me that question, when I rose to answer it that I should be in Order, but I understand that both the question and the answer were out of Order. All of us on this side must hope that the events of the next few months will make the basis of this Bill an economic reality. We must all hope that not only will the events of the next few months enable the Chancellor in April to confirm the benefits that he has been able to give now, but that he will be able to extend them, because all of us, whatever our politics, must look forward to a time when the whole of our population can get some relief from those heavy burdens which for six years they have borne so uncomplainingly.

5.2 p.m.

The Financial Secretary to the Treasury (Mr. Glenvil Hall): I think there will be common agreement in all parts of the House that this Bill has been well considered. It is very long, very technical, and many of its Clauses are highly complicated. Nevertheless, from the time the Chancellor opened his Budget, through the Debate on the Budget Resolutions, the Second Reading, the Committee stage, the Report stage and now the Third Reading, we have between us discussed this Bill in all its phases, and it appears to me that there can be very little left for me to say in a winding-up speech. On every previous occasion we have been delighted by a humorous speech from the right hon. Gentleman the Member for West Bristol (Mr. Stanley) and I think it is only right and proper that we should have had another from him this afternoon just as we are about, as it were, to get rid of the body so far as this House is concerned.
This is, as he said, no ordinary Finance Bill. Much of it appeared earlier in the year and was introduced by my right hon. Friend's predecessor. It is a clearing-up Measure and not an ordinary Finance Bill in the accepted sense of the word. When the hon. Gentleman who sits for the University of Belfast (Professor Savory) was referring to the first Budget he heard in this House in 1894, I began to imagine the kind of Budget that would have been. I think it could not have been anything like the kind of Measure that the House has to deal with today. Income Tax was much simpler then than it is now, and all the fine points which have been made from the other side of the House about Surtax would have been unknown to the House of Commons of 1894 All that is something new which has been introduced since.
I am unable to reply to quite a number of the speeches because I think much of what was said was technically entirely out of order. They dealt with points which the speakers had hoped to include in this Bill but, unfortunately, have not been able to do so. However, something was said by my hon. Friend the Member for Middlesbrough East (Mr. Alfred Edwards) about the motor vehicle taxation and that matter was also referred to by quite a number of hon. Members in the course of the discussion. One of my hon. Friends on this side of the House

suggested that the Chancellor might set up a technical committee to watch the new taxation, to see whether it works smoothly, and to watch its effect on exports. It is not for me to indicate to my right hon. Friend what he should do but, knowing something of what has gone on in the last months and the divided counsel which the Chancellor has had from the motor industry itself on how the taxation should be levied, I really tremble to think what might happen, if, in addition, he set up a new committee charged with the duty of advising him on these matters. The plain fact is that both the present Chancellor of the Exchequer and his predecessor, have had to make up their minds in the light of varying points of view and the advice of differing experts. It is my right hon. Friend's view—I think history will probably share it—that he has done the correct thing in coming down, as he has, on the side of short steps and refusing to turn over to a straight petrol duty. That might by no means have helped the export trade, because the industry would have concentrated, and very properly so, on producing an engine using a minimum consumption of petrol. Therefore it may very well be said in the years ahead that in coming to the decision he has, and to which in fact his predecessor also came, he has taken the only decision really open to him. At any rate we shall have to wait and see.
The right hon. Gentleman the Member for West Bristol put one question to me about Clause 28. That Clause deals with the date up to which deficiency payments can be reckoned and at the moment, in the Bill, it is 31st December. 1946. In the discussions we have had there has been considerable pressure, particularly from that side of the House, to put the date further on, on the not unreasonable grounds to those making the point that 31st December, 1946, was not really far enough ahead to permit industry to readjust itself. My right hon. Friend the Chancellor of the Exchequer dealt with this point and I thought he met the criticism very fairly and very fully. I am here to say on his behalf that he cannot possibly alter the date.
What happened at the end of the last war is still fresh, I hope, in the minds of all of us as to what happened under a similar tax. Much of the revenue accruing was never realised because no definite short date was fixed beyond which indus-


try could not go. Industry now knows that it cannot go beyond 31st December, 1946, but that does not mean to say that legitimate losses which are incurred will not come in for proper treatment. Terminal losses are covered in another Clause in the Bill, and the Chancellor has indicated that, whilst he cannot alter the date, the Inland Revenue will be very generous in the way it looks at what can be considered a terminal loss. I hope that with that explanation and promise the right hon. Gentleman opposite will be satisfied. He asked me another question which, paraphrased, runs as follows, "What fillip has the trade and industry of this country received, or will receive, from the extra £7,000,000 which the Chancellor proposes to raise from the Surtax payers?" I do not, of course, profess to follow all the thought-processes of my right hon. Friend the Chancellor of the Exchequer, but I would not mind venturing a guess that he did not look at the matter in this way. He had to consider it from a much more commonsense point of view. He was making, as from April next year, a reduction of is in the standard rate of Income Tax, and he could see when he looked at the figures, that some Surtax payers, those who enjoy high incomes, would under the is decrease in the standard rate have an increase in their own income of varying amounts up to £4,500 a year. He felt, and I think the House will agree with him—

Mr. Stanley: How many would get relief of £4,500 a year?

Mr. Glenvil Hall: Not many.

Mr. Stanley: Would any?

Mr. Glenvil Hall: Oh, yes. Those in the higher ranges of Surtax payers would get varying sums up to, as I say, £4,500 a year. Of course, many of them would get less; some would get £500, some £1,000, some £1,500, and so on. It would have been possible for a Surtax payer to receive—because of the drop of is in the standard rate of Income Tax—in the next financial year 1946–47 a net increase in his income of £4,500 a year and the Chancellor of the Exchequer thought that at a time like the present, when the rest of the community is suffering, as it is under the heavy burden of taxation, that that would be unfair. What he has done—and this is the answer to another

question which I think was put by the right hon. Gentleman or by the Noble Lord the Member for Southern Dorset (Viscount Hinchingbrooke)—is that every taxpayer, Surtax payer or ordinary taxpayer, gets something from this Budget and Surtax payers may get as much as £350 a year net. So all of us gain, and 2,000,000 of those in the lower ranges, as has been said, go out of the Income Tax paying class altogether.

Viscount Hinchingbrooke: That surely is fully admitted but the point is that it is not pro rata to their gross income and their liability.

Hon. Members: Why should it be?

Mr. Glenvil Hall: That is the burden of what I am trying to say. If it were pro rata they would, or so it seems to the Chancellor, have retained next year, in proportion to people who have a much greater struggle to live, a much higher sum than they should or, to do them justice, many of them desire, to keep in these very difficult and hard times.
The hon. Member for Stockport (Sir A. Gridley) and the hon. Member for Edgbaston (Sir P. Bennett) put another question to me. A similar question was put by them to the Chancellor last night. I really cannot add anything to what my right hon. Friend said then. They desire the dating back of the refunds of monies spent on the re-equipment and development of industry to 1941 instead of to April 1945—the date fixed in this Bill. The answer which the Chancellor gave was that as this money is to be spent —and it was made perfectly clear by the late Sir Kingsley Wood and equally clear by the right hon. Gentleman the Member for the Scottish Universities (Sir J. Anderson)—that it must be spent for a definite purpose, namely, the rehabilitation of industry in the postwar period, for the objective of trying to rehabilitate this country in the markets of the world in the postwar years. Money spent away back in 1941 or 1942, when the war was in one sense hardly under way, could, of course, have been spent on equipment which was going to be used entirely in the after the war years. But if the money was spent then, the people who spent it should have been spending it on something of more use to the war effort than preparing for the postwar years. It is our view, therefore, and I think that it


is a right and just one, that 1945 is the correct date, and my right hon. Friend cannot see his way to alter it.

Major Peter Roberts: Will the Financial Secretary answer a question which I put very definitely to him, and that is the question of the 20 per cent. refund E.P.T.

Mr. Glenvil Hall: I took fairly full note of what most speakers said, but I did not want to weary the House by going through them one by one. I will do my best to answer the question put by the hon. Gentleman. As 1 understand it, his point was this: That certain traders are entitled, or will be entitled, to a refund on account of E.P.T. Normally, that amount will have to be ploughed back into the business and spent on redevelopment or re-equipment. Supposing that industry is taken over by the State, what is to happen to the refund? The short answer, so far as I can give it, is that if it is handed over to the trader before the particular industry is nationalised, he will have given the undertaking, and I have not the slightest doubt he will implement it, to use it in the business in one form or another. If he does not it will still be there, and it will then be for consideration, as and when that industry is taken over and compensation for it is arranged, as to what is to happen to the money.

Major Roberts: The money will be available, that is the point.

Mr. Glenvil Hall: Of course it will, but whether the trader himself will spend it on equipment, or the State, or the corporation, or whatever the body may be which takes over the industry is a matter for consideration at the time, and in the light of the circumstances then existing. There is in this Bill, it seems to me, complicated though it is, evidence of the real desire of my right hon. Friend to help 'both the individual and the industry so far as each can be helped in these very difficult times. As my right hon. Friend said in his opening speech, V.J.-Day is not very many months behind us. This is not a Finance Bill of the ordinary kind; that will have to come next April. This Bill, however, does give to the ordinary taxpayer some hope that the enormous burdens laid upon him during the last six years are going to be lightened; and industry itself, with the payments that

are going to be made to it, will also feel that the Government does desire to assist it too after the six strenuous years that have passed. This Bill sees a beginning made in the direction of tax relief. It also is designed to prevent what we would all wish to prevent, and what is a very great fear with all of us at the moment, the tendency to inflation. The Bill is in fact the first instalment by a Labour Government in power of the better days that are to come not only for the individual, industry and the community as a whole.

Question put, and agreed to.

Bill accordingly read the Third time, and passed.

Orders of the Day — PUBLIC HEALTH (SCOTLAND) BILL [Lords]

As amended (in the Standing Committee), considered.

Motion made, and Question proposed, "That the Bill be now read the Third time."

Wing-Commander Roland Robinson: Is there not someone on the Government Front Bench who can tell the House what this Bill does?

Question put, and agreed to.

Bill accordingly read the Third time, and passed, with an Amendment.

Orders of the Day — STATUTORY RULES AND ORDERS, &c.

Leave given to the Select Committee, to make a Special Report,—Second Special Report brought up, and read; to lie upon the Table, and to be printed. [No.39.]

Orders of the Day — STATUTORY RULES AND ORDERS, & c.

Sixth Report from the Select Committee, brought up, and read, as follows:

Your Committee have considered the Potatoes (1945 Crop) (Charges) Order, 1945 (S.R. & O., 1945, No. 1493), a copy of which was presented on 3rd December, and are of the opinion that there are no reasons for drawing the special attention of the House to it, on any of the grounds set out in the Order of Reference of the Committee.

They have also considered the Order in Council, amending Regulation 42CA of the


Defence (General) Regulations, 1939 (S.R. & O., 1945, No. 1451), a copy of which was presented on 16th November, and are of the opinion that the special attention of the House should be drawn to it, on the ground that it appears to make some unusual or unexpected use of the powers conferred by the Statute under which it is made.

To lie upon the Table.

Minutes of Evidence relating to the Order in Council amending Regulation 42CA of the Defence (General) Regulations, 1939, to lie upon the Table, and to be printed. [No.40.]

Orders of the Day — LOCAL GOVERNMENT(FINANCIAL PROVISIONS) (SCOTLAND) BILL

Order for Second Reading read.

5.20 p.m.

The Joint Under-Secretary of State for Scotland (Mr. Thomas Fraser): I beg to move, "That the Bill be now read a Second time."
This Bill is a purely Scottish Bill corresponding to the Local Government (Financial Provisions) Bill for England and Wales to which the House gave a Second Reading on 30th November. Its purpose, like that of the English Bill, is to provide for an interim adjustment in the block grant payable to local authorities by increasing its amount during the present and the next two financial years.
As hon. Members will be aware, the amount of the existing block grant, and the method of its distribution, were fixed by the Local Government (Financial Provisions) (Scotland) Act, 1937, by reference to the circumstances existing in the year 1935–36. In the ordinary course of events the amount of the grant would have been revised, and the method of distributing it reviewed, in respect of the years 1942–47. That revision and review would have been based on the circumstances of 1940–41. A further revision, relating to the circumstances of 1945–46, would then have been undertaken in time to take effect during the five year period 1947–52. It was apparent in the early years of the war, however, that circumstances were so abnormal and all facts by reference to which the grant is normally calculated and dis-

tributed were so disturbed that it would be unwise and quite impossible to tackle the revision which should have taken place in 1942. The grant originally fixed for the years 1937–42 was accordingly continued by the Local Government (Financial Provisions) (Scotland) Act, 1941, until such time as Parliament might otherwise determine. It is equally clear that conditions are still so abnormal and the future level of local expenditure so unpredictable that a revision of the grant for the five years 1947–1952 is at present out of the question.
The level of rates in Scotland, as in England and Wales, remained fairly steady during the war years until about 1944, but it became evident from the returns received and summarised in the return published on 19th June that in the year 1944–45 rates generally had begun to rise, partly as a result of rising costs and partly as a result of the resumption of works or services postponed or suspended because of the war. The rise in rates over the level for 1938–39 amounted on an average to approximately Is. in the £in the year 1944–45. This increase in local expenditure is being maintained, and the rates are being increased in consequence, notwithstanding the additional assistance being given by grants in aid of education and other services. Some interim adjustment of the block grant was therefore thought to be essential, and it was agreed with the Associations of Local Authorities that it should cover, the years 1945–48. That is to say it should cover the last two years of what would normally have been the 1942–47 block grant period, known as the Fourth Fixed Grant Period, and the first year of the subsequent block grant period—that is, the period 1947–52—known as the Fifth Fixed Grant Period.
Once this decision had been taken, that is, the decision to introduce an interim, grant, the first question was to decide what the total amount of the increase in Scotland should be. If it had been possible, the first step in arriving at this figure would have been to calculate what would have been the amount of the block grant payable in each of the three years in question had the normal revisions in respect of periods beginning 1942 and 1947 taken place. This, unfortunately, was out of the question, because in Scotland the necessary data were not available, and could only have been obtained


after very considerable delay by calling on local authorities for detailed returns. It was therefore decided, as a wholly exceptional Measure—and I want to impress on hon. Members that it is wholly exceptional—and without in any way creating a precedent, to increase the Scottish grant by the Goschen equivalent —that is eleven eightieths—of the amount by which the grant is proposed to be increased in England and Wales. This is an exceptional Measure and we do not intend that it should be taken as a precedent, but I would like to assure Scottish Members that I have enough information about the actual expenditure of the Scottish local authorities and other relevant factors to say that this method of arriving at the amount of new money is not un-favourable to Scotland.
On this basis the block grant in Scotland will fall to increase by £1,375,000 in the present year, £1,512,500 in 1946–47, £1,675,000 in 1947–48. The amount of the grant at present is £6,827,000, so that the increase brought about by this interim grant amounts to 20 percent. in the first year, 22 percent. in the second and 24 per cent. in the third year. These increases represent an average rate relief, calculated on the 1944–45 valuation, of 7·7 pence in the £in the first year, 8·4 pence in the second year and 9·2 pence in the third year. Having arrived at the total amount of the new money to be given to local authorities in Scotland, the Government had next to consider on what basis that total should be allocated among the local authorities concerned On 30th November, when my right hon. Friend the Minister of Health moved the Second Reading of the English Bill, he explained that he was proposing a most complicated method of distribution, and he said that it was designed to give preference to the areas which on the basis of their level of expenditure and rateable value would, in his opinion, be rightly regarded as poor areas. We put the position before the local authorities in Scotland and found that there was general agreement among them. Their decision was quite unanimous that the English formula was quite unsuited to Scottish conditions and would not have resulted in the equitable apportionment of the new money. Consequently, that decision having been taken my right hon. Friend the Secretary of State asked the Associations to propose an alternative method of distribution. In

the course of time they submitted a scheme, and I am today moving the Second Reading of this Bill which gives effect to the proposals of the local authorities. The scheme is being given effect to in Clause 2 and the Schedule to the Bill. These provisions, although not based on any uniform principle, appeared to the Government to be broadly equitable, and it was therefore decided that Parliament should be asked to sanction them.
The distribution proposed in the Bill having, as I have said, been proposed by the local authorities, is generally accepted by them. There are, however, one or two authorities who would have preferred to see the whole of the new money allocated on the basis of the figures of weighted population used in distributing a portion of the existing block grant. Others have asked for modifications designed to increase their own share of the total amount of the new money. The allocation of the new money on the basis of weighted population among the industrial areas and the large burghs would not however have been readily defensible, even if such a course had been acceptable to the Convention of Royal Burghs and the Association of Counties of Cities.
My right hon. Friend would have found it difficult to have accepted such a proposal had it been made, but it was not made, and he has seen fit to accept the proposal made by the burghs themselves. The available figures of weighted population were calculated by reference to the circumstances of 1935–36, and since there is heavy weighting for unemployment, and in view of the considerable change of circumstances during the last ten years, these figures and the formula by which they were arrived at have become in good part obsolete, and could not have commended themselves to my right hon. Friend as the yardstick by which the new money would be allocated among the large burghs. It is true to say that under the provisions of this Bill that weighted population has been used in calculating the distribution among the counties of their share of the new money. In their case the degree of obsolescence of the 1935–36 figures and the formula is somewhat less than in the case of the large burghs.
Of the other variations in the method of distribution proposed by individual county councils it is sufficient to say that none of them—and there were a few pro-


posals put forward by county councils—.produce results which over the country as a whole could be regarded as more equitable than the proposals of the Bill. I would like to give an assurance that when I discovered that there were some local authorities, particularly county authorities, who disagreed with the formula proposed in the Bill, I immediately convened a meeting of all the county councils when the whole matter was thrashed out. It became obvious at that meeting that no formula other than that adopted by the County Councils Association would have secured general acceptance among them. There was some sympathy for one or two of the county councils who were not getting out of this formula the amount to which they thought they were entitled. Generally speaking they did not criticise the total amount of the money. Their only concern was the method of distribution, and as I have said, the method adopted is that which commends itself to the vast majority of the county councils concerned. The distribution of the new money gives a substantial measure of relief to all areas, and should materially assist those whose needs, measured by their resources, are the greatest.
It should be emphasised that this Bill represents an interim settlement of a problem of which the urgency and importance are fully appreciated. Steps are to be taken at an early date to review the block grant formula, and as the Minister of Health has already indicated, the Government have in mind that after various proposals which affect the functions of local authorities have been given effect to a more general review of local Government finance will have to be undertaken. The review of the formula will have to be done between now and 1947, and, as I have indicated, it is necessary, if we are to alleviate the position of the local authority at all, to have an interim Measure such as I have brought before the House today, to give some assistance to the local authorities; and as I have said, we are giving it for the period that commends itself to the local authorities concerned.
If I might turn to the Bill for a moment, hon. Members will see that Clause 1 (1) merely fixes the total amount payable. Subsection 2 of the Clause ensures that in calculating the amount of block grant in

future fixed grant periods, the whole of the expenditure of local authorities, including what they get from new money paid under this Bill, and any other special grants, is taken into account. Clause 2, taken with the Schedule, decides the apportionment, and it is worth mentioning here that we have not made any adjustment in capitation grants to small burghs and landward areas, such as was provided in the English Measure. We have not provided for any adjustment because in consultation with the local authorities we were advised that it was not desirable to do so. There was no call for it, and in any case an adjustment would only have been made at the expense of the county authorities. Clause 3 of the Bill is somewhat technical, and merely applies certain provisions of the Act of 1929 to the new money, in the same way as they apply to the existing block grant. That is the Bill, and I anticipate that it will have an easy passage. The local authorities concerned seem to be generally happy about the amount of the money that is being granted in this Bill; the local authorities themselves decided the method of distribution; and for those reasons I anticipate an easy passage for the Bill through the House.

5.39 p.m.

Mr. J. S. Ċ Reid: Every Scottish Member must be well aware of the magnitude and urgency of the problem of local finance in Scotland, and although it is perfectly true that the hon. Member will get his Bill, it is essential that we should point out what a trumpery Measure it is compared with the problem which has to be faced. Under this Bill we are only getting less than 6s. per head of the population per annum, and this is supposed to be, in the words of the hon. Member, an interim settlement of our difficulties. Our problem is immensely worse than in England. In the document "Return of rates," to which the hon. Gentleman referred, it is made plain that the average for the whole of Scotland, good areas and bad, for 1944–45, was 12s_3d. in the £.That does not sound much to an English Member, and one of the troubles about our system of rating is that it sometimes does not sound much to us. If that is converted to the English method of reckoning rates it comes to over 17s. in the £over the whole of Scotland, and there have been further large increases since then,


Glasgow now has a rate of 17s. in the £. Again, that does not sound very alarming to those accustomed to the English method of computation, but when I say that for every £which the owner of a small dwelling house can keep in his possession after he has paid owner's rates, the local authorities take 26s. or more, that is a position unparalleled in any part of England, or indeed Wales, which has always been regarded as the most difficult part of the United Kingdom for local authority finance. Glasgow is far from being the worst area in Scotland. Several large burghs and a good many districts of counties are considerably worse. In many of them, if the English equivalent were taken of the rate now in operation, it would considerably exceed 40s. in the £. The hon. Member has explained that this Bill is not designed to meet the Scottish position at all. It is quite true that the data were not available. We cannot complain at the end of the war that we cannot yet design a Measure to meet Scottish problems, but let us be quite clear about this: This Bill is a purely interim Measure which simply gives to Scotland eleven-eightieths of what has been thought necessary for England, where the problem is very much easier than in Scotland. It was always easier in England, but whereas, as was explained by the Minister of Health in the Debate on the corresponding English Bill, the rates of local authorities in England have remained constant throughout the war, and in some instances have dropped, in Scotland the position is very different. In Scotland the expenditure started to rise from the year 1943–44. It rose in the year 1944–45 very materially and it is rising very materially again in this current year.
I think it is worth noting the differences in the Explanatory Memoranda of the Bills for the two countries. In the case of the English Measure I read this in the Explanatory Memorandum: 
 The end of the war means that the expenditure of local authorities will start rising again.
On the front of the Scottish Bill, on the other hand, I find:
 …expenditure of local authorities is now rising.
That is an understatement, because it has been rising for the last eighteen

months. Accordingly, a Bill which is designed, as this Bill is, merely to give the appropriate share of the money required for England, where the rise has not yet started, is plainly inadequate for Scottish needs. I shall not complain that the hon. Gentleman has not got a better bargain as yet, but I say that he will have to get a better bargain next time.
If I may again take Glasgow as an example, because it is the place the figures of which I am most familiar with, the rise in rates since the beginning of the war has been 2s.6d.in the £—from 14s. 6d. to 17s.—against the Minister of Health's statement that this Bill was designed for a position where there has been no rise. And what does Glasgow get? Eightpence in the £, as against a rise of half a crown. In the English Bill, what does the corresponding sort of area get? In Merthyr Tydfil, where the position is very little worse than in Glasgow if you take into account the corresponding system of rating, it is 2s. 9d., and in West Ham, where the position is very much better than in Glasgow, it is 1s. 9d. Perhaps we have got to wait a little while in Scotland before we get proper treatment. We must not be in too much of a hurry, but that sort of thing cannot go on, and it will have to be cured, in my submission, pretty quickly. I welcome what the Minister of Health said in the Second Reading Debate: 
 It may be held by hon. Members in all parts of the House that a revision of the block grant formula alone will not be sufficient. …I am sure that is so.
He went on: 
it is also necessary to undertake a more fundamental examination of the basis of local government finance. …"—[Official Report, 30th November, 1945;Vol. 416, c. 1794.]
I entirely agree with that but what I think is not suitable to Scottish conditions is the next paragraph, where he says that we ought to wait to see what will be the effect upon local government functions of the various pronouncements which the Government will be introducing in the course of the next few years. It may be that England can afford to wait so long. We cannot; and we cannot afford, during the interim period, merely to accept eleven eightieths of what the English Minister of Health happens to get from the Treasury on an argument from conditions which are


ever so much easier than they are in Scotland.
I realise the difficulties under which the Joint Under-Secretary has been working. The Secretary of State, we all regret, has been through a pretty prolonged illness, and we are very glad he is now understood to be well on the way to recovery, and it would not be fair to ask his subordinates to raise complicated issues of this kind with the Cabinet in his absence. But I do ask the hon. Gentleman to get his right hon. Friend, as soon as possible, to treat this whole matter of local finance as one of great urgency, and to follow his own line and to refuse to drag at the tail of England. If England can afford to wait for some years, and if England's needs can be met by some comparatively moderate modification of existing circumstances, well and good, but we must have earlier and different treatment so far as our local finances in Scotland are concerned. I hope the Secretary of State for Scotland will make that perfectly obvious to his colleagues in the Cabinet.
This would not be a proper occasion to enter into the possible remedies. It would be quite out of Order and I will therefore only say one thing on that. There is the Sorn Report, which has the assent of Members of all political parties, but does not carry us all the way; some people may think it does not carry us very far. But it is a good start, and I would hope, therefore, that if the Secretary of State is unable—as I am sure he will be unable—to devise a complete solution within the course of months—no one thinks it could be done—he would consider whether he could not make some progress on the lines of the Sorn Report, or something like it. Existing burdens, which already weigh upon us, will grow in extent. Estimates have been made of increased expenditure on education, and even if we put no more burdens on local rates, the amount of rates is bound to go up during the coming years. I doubt very much whether any reliefs that have even been suggested by Ministers, will counteract that inevitable rise. In face of that situation, I do not think that it is right that any new burdens should be put on local rates in Scotland, until we have some drastic modification of the existing system. We on this side reserve the right to object strenuously to the imposition of

any new rating burdens of any kind—any material burdens—on the Scottish local finances until there has been a very material alleviation of the position in one way or another.

The Joint Under-Secretary of State for Scotland (Mr. Buchanan): May I interrupt to get to know what the right hon. and learned Gentleman means by that? He says he will reserve to himself the right to object strenuously to any new burdens. Does he mean legislative burdens, or the provision of new schools, which are an everyday burden on the local authorities at the present time?

Mr. Reid: I thought I made that clear, I said the existing burdens, such as education, would necessarily grow, and they will grow. Schools are very necessary. Even more necessary are teachers, and they have to be properly paid, and we all recognise that. What I mean is that if the Government are going to carry out their social reforms, they must find some other method of financing them than off the rates, until they have remodelled the rating system to a considerable extent. I welcome social advances, and I realise they are going to be very expensive. But what I say is, that we have already exhausted the possibilities of rates in many areas and the Government are asking for collapse in local finances if they put any more burdens on rates before they have achieved their reforms. Therefore, in the intervening years—I hoped it would be months, but I am afraid it will be years —in the intervening period, I ask the Government to devise some other method of financing their reforms, rather than the method of putting 50 per cent. on the rates.
To sum up, we agree that this Bill should be passed. We agree that so far as it goes, and it is not very far, it does meet a need. We cannot say that the Joint Under-Secretary ought, in this Bill, to have done any more. It would not be fair to expect him to do more. But we do say further action of a drastic kind will be needed in the immediate future, and we hope that the Secretary of State for Scotland, having returned in good health, to his office, will be able to tackle this question energetically and quickly, and if he does so, I too hope that we can give him our enthusiastic support.

Mr. McLean Watson: I do not often agree with the right hon. and learned Gentleman the Member for Hillhead (Mr. Reid) but I agree with him as far as this Bill is concerned. It is a miserable little Bill and does not meet the situation which we know to exist in Scotland in regard to local finance. The right hon. and learned Gentleman added that it was as much as we could expect, because we are still tied to the Goschen formula of eleven-eightieths of expenditure, and that limits the amount that can be provided under this Bill. But I agree with the right hon. and learned Gentleman, that we require something a great deal more drastic before we are out of our difficulties with regard to local finance in Scotland. I certainly did not agree with him however on this point—that we should strenuously oppose any changes that are going to mean additional expenditure to the local authorities. He instanced the new Education Act, which was passed before the end of the Coalition Government, as an Act which will cause a considerable increase in expenditure in Scotland. There are other Measures that have been passed, and other Measures coming along, which will undoubtedly increase our local expenditure, and we require, as the Joint Under-Secretary indicated, that the local authorities and the Government should sit down together and discuss the whole question of local finance.
The right hon. and learned Gentleman the Member for Hillhead seems to have forgotten that the sort of speech he made this afternoon has been made before from the Opposition side. It seems to be the type of speech often delivered from the Opposition side. When a Member changes from one side of the House to the other, he changes his speech. The line that the right hon. and learned Gentleman took this afternoon, was exactly the line we took when the Local Government Bill of 1929 was before this House. We said the same things about the finances of the scheme, then that the right hon. and learned Gentleman has been saying this afternoon. But we on this side agree with that view. That is the difference between us—we have not changed. We believed in 1929 that more money should have been put into that Local Government Bill, that we should have had a new formula, and not the

Goschen formula that was continued in that Act of Parliament, and that more money should be given to Scotland for local government purposes.
Undoubtedly, local rates have been rising in Scotland. If the Financial Memorandum to the English Bill is correct, that local expenditure in England will arise only after the war has ended, whereas the right hon. Gentleman has pointed out we are not in that position in Scotland. Our local rates have been rising during the period of the war. In 1943, 1944, and this year, the whole tendency, both as far as large burghs and counties are concerned, has been for rates to rise. They have been rising the whole time, and they will rise more rapidly as soon as we put into full operation such Acts of Parliament as the new Education Act and others, which are bound to increase local expenditure. I hope, therefore, that my hon. Friend the Joint Under-Secretary will convey to the Secretary of State the fact that we on this side of the House are just as anxious as the right hon. and learned Member for Hillhead for a full and frank discussion between the Government and the local authorities, on the question of local expenditure. We must state here, however, that, so far as our social services are concerned, our local government services, they must not be curtailed. We want improvements, in addition to the Education Act, which will undoubtedly increase expenditure in Scotland. We have a huge housing problem to face and other things which will add to local expenditure, and the position in Scotland is really serious. It was serious, as a matter of fact, in 1929, and it is just as serious now, proportionately, as it was in 1929.
I do not want to raise any feeling between county areas and burghs. The hon. Gentleman who moved the Second Reading of the Bill drew attention to the fact that the money which is available is to be distributed on a different basis from the block grant system. Under the Act of 1929, involving the block grant system, questions of unemployment and population had to be taken into consideration in apportioning the grant as between one local authority and another. The Joint Under-Secretary stated with regard to the money that is available, that no provision is made for that system which was


introduced in the Act of 1929, and that questions of population and unemployment were not to be taken into consideration in the allocation of this grant. I agree with that principle. The position today is different from what it was in 1929 so far as unemployment is concerned. There may have been, in certain areas in Scotland—for example, certain large burghs and industrial areas—cases of considerable unemployment in 1929, and that was taken into account when we considered that Measure. The position has been different during the period of the war, and, after all, this is a very limited Measure providing as it does for three years.
I, therefore, agree that there could not be introduced into the distribution of this money that principle of population and unemployment in order to help what are called the poor areas to get a larger proportion of the grant. After all, what is the test of a poor area as against another area? Is it because a local authority has a higher rate? A local authority may have a high rate prevailing in its area, but that may be due as much to a low assessment or valuation as to actual poverty existing in that area. It is a question of assessment. If properties in the burgh have been considerably undervalued or under-assessed, undoubtedly there is a correspondingly high rate. So that the rate prevailing in any particular burgh is not a real test of the position in that burgh.
I do not wish to speak very long because I know there are other hon. Members who wish to discuss an important matter of this kind. But I want to say that I thoroughly agree with the right hon. and learned Gentleman, and I hope if he happens to change from one side of the House to the other before this matter is dealt with, he will not change his mind. I do not reprove him for changing his mind, because I do not think he was here in 1929 when we discussed the Measure now in operation. I agree with him that we do require to have this question of local finance in Scotland completely overhauled, and a proper understanding reached as between the central authority and the local authority. I know that hon. Members opposite and their friends in Scotland are very anxious to have the English system of rating introduced into

Scotland. I think that in days not far distant, we may have some very hot discussions on that particular subject. I suppose we shall be shown how the system of rating in Scotland affects the rating authority, and how another system affects it, but, whatever the system, as far as local rating is concerned, I hope there will be agreement on both sides with regard to the financial position of the local authorities in Scotland. We should have had a better arrangement in 1929. We have suffered as the result of an Act which was passed at that time, and we now require the block grant system to be overhauled so that more money will come from the central government and less from the pockets of the local ratepayers.

6.6 p.m.

Mr. J. L. Williams (Glasgow, Kelvin-grove): In attempting to address this House for the first time, I know I shall receive the sympathy and tolerance which have been extended to so many other hon. Members in the past few weeks. Like previous speakers, I wish to extend to the Minister my welcome of the provisions of this Bill. I know they will be welcome so far as they go, but in the estimation. of many people, the amounts will be too small and dissatisfaction will be expressed at the fact that we are still on the old unsatisfactory basis so far as local government finance is concerned. So far as I can see, we are continuing on that basis. I know there is a promise that the matter will be considered before very long, and I feel the sooner something is done the better, because there cannot be a very fair distribution if the basis of the distribution remains the same.
There are a few points I would like to raise, but not those mentioned by the hon. Member for Dunfermline Burghs (Mr. Watson), such as the English or the Scottish systems of rating, or under-assessments and over-assessments. I leave those to the older Members. There are some points with which I am very much concerned. The question was asked in the last few days in connection with the English Bill as to when we would have a real costing system for the social services carried on by the different towns. Emphasis has been laid upon the need for having a costing system for a given service in every given town. There are some things which, it occurs to me, should be gone, into when the promise made by the


Minister is implemented in regard to reforming the system of. local government finance. Let us take, for example, the policy of giving a service in an industrial town as against running a corresponding service in a non-industrial town. In the industrial town we will find a wide range of social conditions inseparably connected with the industrial development of the town, which will not apply to the same degree in the more commercial and less industrial towns. Take, for example, a town made-up very largely of working class tenements. How are we going to measure the cost of the maintenance of public parks in that town as compared with the maintenance of public parks in a town which is made up very largely not of tenements but of ordinary cottage dwelling houses? Take as another example a city or a town which is traversed by a big river. How are we to maintain a free system of bridges and ferries for that town as compared with another town which has no such problem to face? Again, we have one town blessed with educational endowments which have been handed down for hundreds of years, while another town has no such blessing and has to do without it. We find a great many such inequalities in relation to maintaining different services, and it is a point which has been overlooked so often in comparing the position of one town with another in regard to finance.
There is also the point of securing equity in regard to the contributions of the ratepayers in the different towns. Both in industrial towns and commercial towns we come back to the fact that, in the main, values are based not on industrial or commercial properties, but on houses and shops—to the extent of 80 per cent. Many of those houses in the industrial towns are small and old. Here is a point which should be kept in mind in regard to values in all the industrial towns. A great many of the houses are substandard, and consequently their rateable values have to be substandard. As many as 20 per cent of the houses in some towns have only one or two rooms, with the result that the rents correspond with the size of the houses, and rateable values correspond to the rents. Yet, it is into those districts that we must put public money in the shape of public assistance, public health, public parks and open spaces, public baths and all the different services, to make up for the con-

gested conditions, until one is fairly soon convinced that nothing is as costly as poverty. I cannot speak with long experience of local government as can some hon. Members with whom this House has been blessed from the day when the Radical Mayor of Birmingham, Joseph Chamberlain, came to the House of Commons. From that day this House has not been without the value of great municipal experience. But my experience of local government has been only for a comparatively brief period. I know the Minister will say that it is not the intention of the Bill to remedy the points which I have mentioned. I will only make one pertinent point there; because of that, it will be much more difficult to effect a fair distribution of the moneys provided in the Bill.

6.15 p.m.

Mr. Alexander Anderson: I feel myself happy tonight in being the first to extend the congratulations of this House to the hon. Member for Kelvin-grove(Mr. J. L. Williams), upon a well-informed and thoughtful maiden speech. I am certain that when he takes the opportunity of intervening more frequently in Debate we shall value his contributions, coming as they do from one who has a well-informed mind and a nice quiet method of delivery.
I want, on behalf of the local authorities of Scotland, to welcome this little Bill, not because it is a good Measure—it is a mean little Bill—not because it deals adequately with the situation with which it is supposed to cope; but because it is at least some tardy recognition from the Department that the problems of local government administration in Scotland require help. During the six years of war the rates in England have been relatively static, whereas in Scotland we have had to face constantly rising municipal costs, increases in wages, increases in cost of materials and the provision of services of greatly increased size for the population. They have led to a steady increase in the costs of our municipalities. Today, we are faced with still greater increases, towards which we get only this sum of £1,375,000, from the Treasury. We welcome, however, that small amount. Actuarially, it may be according to the Goschen formula, but it bears no relation whatever to the actual needs of the local authorities of Scotland,


if they are to maintain the efficiency of the services which they are called upon to administer.
The services which they administer are responsible for the health and happiness of 5,000,000 people in this Island. We welcome the Measure, too, because it gives us a promise that in 1947–48 the whole of the relationship between the local authorities and the Treasury will be reviewed. I would warn this House that if the central authority is to impose upon local authorities ambitious new measures, which may be highly necessary but will give us more costly services to administer, there will need to be a completely new orientation of the local authorities in Scotland in regard to the Treasury. Otherwise our ratepayers will be asked to pay rates beyond their capacity to pay and, what is even more serious, our capacity to attract to Scotland those lighter industries which we need will be jeopardised by the fact that the high rates will be a deterrent factor.
Nevertheless, we welcome the Bill. All the local authorities in Scotland welcome it, but there are many authorities in Scotland who do not welcome the method by which the money is to be apportioned. I was very glad to hear from the Minister that he could not say that the money was being divided upon any principle. It was being divided by what he called, euphemistically and optimistically, general agreement among the local authorities of Scotland. Actually, the position is this: First of all, there is no principle on which this money is divided. It is a most haphazard business, in which certain local authorities have come out very well. It is divided, in regard to burghs, on population plus rateable value. In counties it is divided on weighted population plus rateable value. The results are sufficiently to be judged by themselves.
When the Local Government Act, 1929, was passed, a formula was devised, an empirical formula if you will, but one which met the needs of Scotland and the wants of the case. It met that case so successfully that from then to now it has never been challenged. It was a formula, as may have seemed to some people, based entirely upon the unemployment factor. The weighted population takes into consideration many factors, for ex-

ample, the number of children under five in relation to the population. It deals with this very vexed question of rateable value, because one of the factors is a percentage when the rateable valuation per head is less than £12 10s. My burgh has a rateable value of £7 8s. per head, so even in that very formula there is an allowance for low and high rateable values. The formula also, very rightly, takes into consideration the question of unemployment. When people are congratulating themselves that the unemployment factor does not count, may I remind this House that, in my burgh today, the percentage of unemployed to the insurable population is 15 per cent., and that in Lanarkshire, industrial Lanarkshire, we can see the cloud of unemployment coming between us and the sun of prosperity? It may not be very long, unless this transition is short, before we may be very glad to go back to the weighted population formula, if local services in Lanarkshire are to be carried on properly.
We had a formula which operated to everybody's satisfaction, but because this Measure was being brought forward hurriedly and because it was initiated under Coalition auspices at a time when agreement was more important than equity, we found the formula departed from. I do not stand up here for the old formula. I believe that some necessary alterations should have been made, but I say that the method by which this allocation has been made does not follow any formula. It does not adhere to any principle and there is no system whatever about it. The only way we can judge it in the West of Scotland is by asking, How does it work? I elicited from the Minister who is to reply, in answer to a Question in this House, certain significant figures.
These show that if the formula is obtained by agreement, two bodies in Scotland are suffering most from this method of agreement. First, there is the position of the larger burghs. The only association to which the larger burghs can belong is that mediaeval anachronism the Convention of Scottish Burghs. A dozen large industrial burghs are islanded among all the rest of the burghs in Scotland. Those smaller burghs have been shorn by the 1929 Act of many of their


powers, and their interests are bound up with the counties in which they carry on their services. When it comes to the question of interest, they automatically go with the counties in which they are situated and not with the larger burghs, where they might normally have belonged if they had been free burghs.
The result is that the Convention of Scottish Burghs can get agreement by a majority, but it is an agreement which has hurt the large industrial burghs. If we look at the actual facts elicited by this division we can see that something is completely wrong. We find, for example, that those burghs, generally speaking, with the lowest rates, the highest valuation and the least percentage of unemployed, get a larger sum, and that the industrial burghs get less. I do not want to make invidious distinctions but, obviously, from this method of allocation, it seems perfectly certain that the City of Edinburgh has become what I might call the spoilt darling of the Scottish burghs. I find, for example, that in 1945–46 the City of Edinburgh gets £79,990 more under the new method of allocation, while my industrial burgh, a hard hit burgh striving to produce decent citizens, to provide adequate services, to cover up the decline of coal and do away with the obsolescence of the heavy steel industry, will get from this generous method £8,000 less than it would have got under the old formula. The rates of Edinburgh are 8s. 3d. in the £, while the rates of Motherwell and Wishart today are 14s. 7d. With this process continuous for two years, in 1947 the City of Edinburgh is going to get £97,000 more than under the old formula, while my town's deficit is going to increase and we shall get almost £10,000 less. I do not care what the principle or lack of principle on which this thing is allocated; the figures themselves show that there is something wrong with the method of allocation.
When we come to the provisions of Clause 2 we find that the Western counties, the industrial counties, are getting their allocation on the weighted population, which includes the density factor calculated by the amount of population to the mile of roads, a very heavily weighted factor. Lanarkshire, Dumbartonshire and Renfrewshire, three counties which may be classified as counties, but which

have wide open spaces will share, because they are classified as counties, in 47 per cent., which they secured after a most unsavoury wrangle with the burghs, instead of 53 per cent., but the bulk of those counties is urbanised. They do not get the benefit of the density factor in their weighted population, with the result that they get the worst of all possible worlds.
An extraordinary position arises in the counties, where we can actually see how the system works The county of Dumfries, with a rate of 8s. 8d., where rates have fallen during the war by is. 4½d., gets a rating relief of 11·7d. in the £The county of Dumbarton, with a rate of 10s. 6d. in 1944–45, which even with this grant has risen by 10d. this very year, gets a relief equal to 5d. in the £. We find that Banffshire gets 26.2d., that Aberdeenshire gets 18d. for their relief while Lanarkshire gets 10·8d. allowance. The whole thing is crazy.
I do not expect that at this late stage it will be possible to make much change. In any case, we have the rate for this year, and our ratepayers most reluctantly will have that money drawn out of them. I implore the Minister to consider the future two years. It is a shame, indeed, I say deliberately it would be a crime, against the industrial West of Scotland if this method of allocation is perpetuated for two more years. I am not here as a mendicant to plead for pennies for Lanarkshire nor am I here as a huckster to bargain with the Scottish Office, but we want this money allocated in accordance with equity and we do not care what the formula is. I can assure the House that there is a deep feeling of dissatisfaction among the larger burghs in Scotland, and particularly among these three counties of Dumbartonshire, Renfrewshire and Lanarkshire, at not having got a square deal. We look to this House and to the Scottish Office to see that, in the two succeeding years, we get a square deal.

6.29 p.m.

Sir William Darling: I am very interested in this subject from two points of view. I prefer to deal with the larger aspect first, on which we shall get the greatest measure of agreement. As the hon. Member for Motherwell (Mr.A.Anderson) has quite


properly said, this is a miserable Bill, a contemptible Bill, and when I think of the promises, the expectations and the hopes that even I had of His Majesty's Government, I think they might have secured a larger measure from the Treasury than this miserable sum of £1,375,000.

Mr. Gallacher: Is the hon. Member aware that the Bill is the product of a Tory-dominated Government?

Sir W. Darling: I am grateful for the intervention. I am not aware of that, because I read on the Bill in front of me these words:
 Bill presented by Mr. Secretary West-wood, supported by the Lord Advocate, Mr. Buchanan and Mr. Thomas Fraser.
I shall believe that it is a Bill put forward by a Tory Government when I see the hon. Gentleman voting against it. I, like other Scottish Members feel keenly about this matter, and I think it has brought us unity in pressing upon the Government and the House of Commons the inadequacy of the 11/80ths allocation. I do not know if Englishmen have followed at all closely the history of Scotland during these war years. For most of Scotland it has been a period of depression and unemployment. It is known to this House that in 1939, when we wanted to set up our industries in Scotland, the factories were used for storage purposes, and we were not able to offer that share in the war effort which we would otherwise have been able to do. Do the English and Welsh Members of the House and those of Northern Ireland, know that we have had to export the greater part of Scottish labour to supplement the needs of England and Wales? Do they know that we have had to export our women folk from Dundee and from Lanarkshire in order to strengthen the industrial equipment of other parts of this island, and that this futile and foolish policy is reflected in this 11/80th grant? Unless this part of the United Island can be diverted from placing all its valuable economic and administrative assets in the South-East of England, we are doomed to extinction in the next war.
There is some overwhelming passion to develop this great capital and county of London. There are 8,000,000 inhabitants in London, 3,000,000 more than in the

whole of Scotland. There is a tendency in the administration of the country to favour the development and redevelopment of the population of London. London was threatened by Julius Caesar, by William the Conqueror, by the Spanish Armada, by the first German war, and it was almost extinguished by the second German war. Yet you continue placing all your most valuable administrative and economic assets in the most dangerous and vulnerable parts of this island. You are continuing to do it. Now I am told that you are going to rebuild London. Scotland has been, and is being, placed at a disadvantage compared with the rest of the island. Let me remind hon. Members once more of what happened during the war, when our great ports were bombed out, when Portsmouth and Plymouth were attacked. The naval vessels were hurried up to Rosyth, and the Government pleaded with the shipping of the Clyde to get busy. It happened again and again in wartime.
All the Scottish Members of this House have a duty to impress on this House of Commons that the allowance made from the Treasury of £1,375,000 under the 11/80ths grant, is contemptible and mean. There are, in my country, great human assets, great industrial assets, great social assets. It is not the least valuable part of Great Britain, and I appeal to those who speak for other burghs and parts of Scotland to cherish that valuable national asset and to reinforce it, stimulate it, to encourage it because it is indeed a very precious one. The first of my adjectives, applied to this Bill, is one which I am sure every Scottish Member will agree with in relation to the help which the Treasury is so niggardly in offering for Scottish needs and conditions and problems. It is contemptible, and mean; and the only gratification I have is the feeling that it will not be for longer than two years. The hon. Gentleman who introduced the Measure assured the House that this is an interim piece of legislation, and I am quite glad to accept it as such. It has been commented on that there are fairer schemes under this administration than under the previous one. They may be good or they may be bad, but the proposal is certainly not a very attractive one to me.
I have dealt with the larger Scottish aspect. Now I feel I shall have to descend to the domestic squabble for which we Scottish Members are perhaps better equipped. I would like to join with the hon. Member for Motherwell (Mr. A. Anderson) in congratulating the hon. Member for Kelvingrove (Mr. J. L. Williams) upon his maiden speech. There are good and great men who come out of Glasgow, and I am delighted to join in congratulations to the hon. Member. The hon. Member for Motherwell fulminated against this Bill and compared his burgh with the Capital City. I have taken a lot of trouble to look out some figures which do not seem to bear, out the somewhat dismal picture he presented. I was going to rise, if I had the good fortune to catch your eye earlier, Mr. Speaker, to draw the attention of the House to the somewhat scurvy way in which the Capital City of Edinburgh has been dealt with, as compared with the lesser burghs and counties, and had some figures worked out which very substantially support that view. I should be glad to exchange these with the hon. Member for Motherwell, although 1 do not wish to score debating points in the argument which is bound to be based on these comparisons. 
I have here a chart of the apportionment of the Exchequer grant relating to the three years 1945–46, 1946–47, and 1947–48. I take Motherwell and Wishaw, because, although the hon. Member has not mentioned this, they go together in this matter. The apportionment per head of the population—and there is a good population in Motherwell and Wishaw—is £1 14s. 11d., whereas the apportionment per head of the population given to the City of Edinburgh is only £1. That is for the period 1945–46. If I take 1946–47, again Motherwell and Wishaw has £1 15s. 5d. and Edinburgh £1 0s. 7d. For the year 1947–48, in prospect, the apportionment for Motherwell and Wishaw will be £1 15s. 5d., while that per head of the population of the capital city will only be £1 1s. 3d.

Mrs. Jean Mann: May I ask whether the hon. Member would agree to the weighted population formula, in exchange for half valuation, half population?

Sir W. Darling: I would agree to the formula as submitted, but what I am

endeavouring to do is to answer the suggestion that the City of Edinburgh is very advantageously placed, in comparison with other burghs and other cities. This, I think, is the answer. It may not be a complete answer, but it is an answer which cannot be gainsaid. The comparisons need not stop there. Lanarkshire County for the year 1945–46 gets £2 0s. 4d. These are basic figures, which, as I said before, cannot be gainsaid. I suggest that what has been said of the apparent advantages which have been conferred by this formula upon the City of Edinburgh are unjustified by the figures. There are other ways of looking at this matter. The hon. Member for Motherwell, as a burgh treasurer, has, I am sure, the facility to manipulate figures to suit his several cases, and I have no doubt that he has had much experience in that direction, but let me quote some more figures. The rate burden per head in Edinburgh is £5 1s. 11d., but in Motherwell it is £2 19s. 4d. The grant in round figures at the present moment for Edinburgh, based on the £5 1s. 11d., is 1s. That based on Motherwell's is 4s. 4½d. In Edinburgh now we are to get is. 6½d. but in Motherwell they will get 5s. 0½d.
It does seem to me that there is a grievance, if there is one at all, on behalf of the Capital City which, unlike Mother-well, has not had the continuous period of full employment which it has enjoyed during the last three to four years. Edinburgh is looked upon as a wealthy city. It is a frugal, a prudent city, which has always kept its rate burden the lowest of the United Kingdom, 7s. 11d. in the £, or at any rate it was until last year. That is usually not a demerit. Motherwell has other advantages for which I could speak, and so have other burghs in similar circumstances, and that is, that it is included as a development area. Factories have been built there, or are going to be built there. Motherwell, I think I am right in saying, is to have the services of the Special Housing Association to supply good housing. Edinburgh enjoys none of these advantages. We have never been in a development area, and we are not included up to now in the area in which the Special Housing Association is to operate. The other burghs and cities will benefit from the operation of the Trunk Roads Bill, but Edinburgh will not. Motherwell will benefit by the special


grants which the Lanarkshire education authorities will get, but Edinburgh will not be so advantaged.
These are some of the factors which, in my opinion outweigh, even the arguments of the hon. Member for Motherwell. I think it would be unfortunate if there were to be any domestic squabbling about these matters. Edinburgh accepted the old formula and we are accepting the new formula. We think it is a fair one. Edinburgh has a prudent, frugal civic management that is not always seen in other parts of Scotland. The population of the City of Edinburgh may not be subject to the degree of unemployment of the industrial districts, but there is this factor. It includes a very large number of persons, I think very worthy ones, who have retired and are living upon fixed Incomes and who have suffered very severely from the incidence of Income Tax. They have to pay for social services which they do not require, and which they cannot use.
This is the "new poor" of my city, and I think that they are entitled to some consideration. Edinburgh is not even solely a commercial or a financial centre. We have, however, in our midst, the burgh of Leith, and no part of this country has suffered grimmer unemployment, more continuous and more devastating, than the burgh of Leith. Consequently, I think we are entitled to say that this new formula is fair to other parts of the country; they are all getting more, much more, and none are getting less, and it is for that reason that I have taken the trouble to quote the example of the City of Edinburgh.

6.44 p.m.

Mrs. Jean Mann: I welcome this Bill, or rather the supplementation of the Exchequer block grant. I do not think there is sufficient of it, and what there is, is not equally or even equitably divided. However, what we have of it is I say quite acceptable. I do not agree with my hon. Friend the Joint Undersecretary when he said that it should materially assist those whose need is greatest. Actually, the quarrel that the Lanarkshire Members have with this Bill is precisely that it fails to do that. The hon. Member for South Edinburgh (Sir William Darling) has just told us, in very strong and unmistakable terms, that he

is not pleased with what it does for Edinburgh, but who are those whose material need is greatest? I do not think it is Edinburgh—a very fine city, with crisp air and high winds, and a very clear atmosphere, uncontaminated by the dirt, smoke and depression of industry. In my constituency the sky is darkened long before one gets there because it is surrounded by industry, which is not even planned apart from its houses; its huge, monstrous works are close against its houses and its air is darkened. There is a dull depression constantly over the burgh, which has a very high incidence of respiratory disease and a rate of 17s. Id. in the £—still rising.
My hon. Friend the Joint Undersecretary has divided this in a very unfortunate way, because according to his formula, based on half population and half valuation, Edinburgh runs from £66,000 for the weighted formula to £146,000, whereas my constituency will have to carry a loss of practically £10,000 for each of the three years. £10,000 per annum means 100 per cent. That is very considerable indeed. The same applies to the burgh of Airdrie, where we shall suffer approximately 58 per cent., because of the different method of calculating the block grant.

Sir W. Darling: Does the hon. Lady mean 58 per cent. less than they received before?

Mrs. Mann: No, not less than we had before, but less than we would have had if the formula which we wanted had been adopted, namely, the weighted formula. But we have had to accept the formula based on half valuation and half population, and we do not like it;58 per cent. is the difference between the two.

Sir W. Darling: Can the hon. Lady tell us how much more her burgh will be getting than it got under the old grant?

Mrs. Mann: About £6,000 for Airdrie and £10,000 for Coatbridge.

Sir W. Darling: They are getting more, then.

Mrs. Mann: I know it is true that we are going to get something different in the future, and I hope my hon. Friend the Joint Under-Secretary may review it again later on. I would like to repudiate most emphatically the suggestion made


by the right hon. and learned Member for Hillhead (Mr. J. S. C. Reid) that the Sorn Committee Report would in any way assist Scotland. I should also like to point out that that report was not unanimous as he said; there were two Members of the Labour Party on the Commission, one of whom entered a dissenting memorandum. If we examine the Sorn recommendations, what are they? Would they put another penny into the pot for distribution to the people of Scotland? Not at all. My right hon. and learned Friend well knows that there were two recommendations from that Committee. One of them was that the tenant should pay any future increases in our rates. Will that help anyone in Scotland except the owners? The second, to encourage private enterprise to build owner-occupied houses, was that such houses should only carry a combined rate of 5s. in the £. As Glasgow's combined rate is 17s., one wonders who is to contribute, who is to subsidize the new owner-occupier who is recommended for a 5s. combined rate. I do not think that the recommendations of the Sorn Committee would assist Scotland in any way, and I do hope that the Under-Secretary will give serious attention to the really embarrassed condition of Scotland, dependent as it is almost entirely on the heavy, and therefore the export, industry of our country.

6.52 p.m.

Mr. Gilzean: Although I have from time to time asked a question in this House, this is the first occasion on which I have ventured to raise my voice in Debate. Having regard to that fact, I am sure that I shall have the kind indulgence of every Member here.
I would like to say right away that I rather deplore that the Debate should have taken a turn which seems to indicate some rivalry, as between community and community. This Bill is a very good Bill. I agree with the right hon. and learned Member for Hillhead (Mr. Reid) that perhaps it might have been built on more generous lines, and I do not suppose that there is a single Member on either side of the "House who would seek to deny that, but it seems to me that there is not the least doubt that it is a step in the right direction and, if it is somewhat limited, that can be cured at the end of

three years. I do deplore this discrimination between community and community, and particularly do I deplore it when a special reference is made to the city in which I was born, the city which I have served in a public capacity for over 20 years. I will agree with anyone who says that my native city is hard-fisted so far as municipal administration is concerned. It has always been exceedingly careful of public expenditure. There is an explanation for that. There was a time in the history of the city when it was completely and absolutely bankrupt and had to make a composition with its creditors, and to fund its debt at 3 per cent. It took something like 80 years to liquidate that debt. If anyone who is interested in good literature wants something worth reading, he should consult Lord Cockburn's "Memorials of his Times," in which he will find the whole story.
I also think it is entirely wrong to compare the rating of one city with that of another because, generally, the basis of comparison is completely wrong. There is only one basis of comparison that is likely to show the truth, and that is not to compare the rates themselves, but the pressure per head of the population of those rates. A remark was made to the effect that the Glasgow rates were 17s. 0d. and that the Edinburgh rates were 7s. 11d.—actually now they are 8s. 3d. —but still the Glasgow rate is more than double that of Edinburgh. When the formula of pressure per head of the population is applied, it is found that the pressure per head in Edinburgh is £5 3s. 2d. and in Glasgow £8 0s. 10d. This falls far short of the double rate which the other figures would seem to indicate. We must, therefore, examine this question quite dispassionately. It is true as has been said, that under these new proposals Edinburgh will get something very much less than it would have got on a population basis, and less than any town in Lanarkshire, or even the County of Lanarkshire as a whole.
I, therefore, suggest that the best thing to do is to accept this Bill and make the most of it, and resolve that when the opportunity comes along we will seek to evolve something much better. We have been told—we have almost been twitted with the fact—that Edinburgh is a beautiful city, and I would be the last to deny that. I glory in its beauty, but I want


hon. Members to keep in mind that I could take them into parts of Edinburgh that are at once a challenge to Christianity and a reflection on our civilisation. It is altogether wrong to imagine that there do not exist in Edinburgh conditions that give us cause for shame, and, I hope, a resolve for amendment in the future. The only thing I can add is this. Let us take what we are getting and seek to make the best of it, resolved, not in division, but in unison, to seek something in the near future which will make for the betterment of Scotland as a whole.

7.0 p.m.

Mr. Willis: I rise to support this Bill. Like a former speaker I am not altogether satisfied with the generosity with which Scotland is being treated, but it is in accordance with the formula laid down, and why the hon. Member for South Edinburgh (Sir W. Darling) should condemn this Government for that formula is rather beyond me. The condemnation should have been levelled many years ago and should not arise at this juncture. However, given that sum of money, the question is how is it to be divided, and that seems to be the issue that has caused controversy in the House tonight. The money could have been divided on the same basis, I understand, as the grant had been divided in England, but the Scottish local authorities refused to accept that as a basis. It then fell to the local authorities to devise a basis on which they would prefer to have it divided, and it is only fair that my hon. Friends in front of me should remember that the present allocation as between the burghs and the counties and as between different burghs and between different counties is, and has been, accepted by the majority of counties and burghs in Scotland.
We have had some arguments adduced as to why this allocation is not a good one. I do not wish to enter into the controversy about facts and figures. Facts have been introduced to demonstrate one case and facts brought forward to demonstrate another, and most of us are well aware that we can produce figures to support any arguments we like to make. But it is suggested that we should not have changed the old basis on which the calculation was made. I venture to suggest that that

basis has itself changed. The old formula is based on facts which have changed. It is based, for instance, on the weight of population, the number of children under five, and the incidence of unemployment, and if anything has altered during the past five years it is the incidence of employment and unemployment. As the basis of the formula has changed, I suggest that the method of calculating that formula should also be changed, and I think the local authorities were correct in changing it. I suggest that the formula, if we accept the 1936 basis for working out this matter, would undoubtedly work out much more favourably for those counties complaining because of the fact that unemployment is one of the factors, and that unemployment was larger in those quarters at that time, but I am rather amazed that my hon. Friend in front of me should be looking once again to high unemployment figures in the West of Scotland. I have a rather greater faith in this Government than that. I do not think the country should look to high unemployment for several years. The difficulty should not be to find employment but to get the materials and a sufficient number of men to meet the many needs of this country.
That was the main argument with which I wanted to deal, the change in the basis. Secondly, there is the factor of unemployment. If we take the position during the past four or five years the counties that are complaining in Scotland are those that have been comparatively fortunately placed. That is a fact which is being forgotten. The counties in the West of Scotland have been fairly prosperous, and whilst it may be true that the county councils of Dumbartonshire and counties have suffered as the result of the blitz it is not true to say that the others have suffered, and their share of the prosperity has probably been, as is usually the case, much greater than the share of towns such as Edinburgh which do not rest on an industrial basis.
I think, therefore, that the Bill and the allocation of the money as between counties and counties and burghs and burghs is a fair one, and I trust that the Government will not give way to the pressure being exerted to change it without giving the matter very careful consideration. It is true that we have to face the fact that enormous burdens are being placed upon local authorities. The in-


creased expenditure they will be called upon to bear in connection with extended educational facilities, housing, the social services, and higher wages for nurses will throw an immense burden upon them, and I would like to impress upon my hon. Friend the necessity for considering this at the earliest possible moment. We are getting three years' grace, but I think it has to be tackled very early if we are to get out of the mess, because that is all what we are in at the present time. We are trying to ride two horses at once; we are increasing expenditure without calculating the method by which we are going to meet that expenditure. We seem to be rather dilatory in tackling that problem, so 1 urge on the Government the necessity for dealing with it at the present time if these schemes are to go forward as we wish.

7.7 p.m.

Mr. McAllister: My intervention will be a very brief one. The right hon. and learned Member for Hill-head (Mr. J. S. C. Reid) has described this as a "trumpery Bill." The hon. Member for Dunfermline (Mr. Watson) described it as "a miserable little Bill." The hon. Member for Motherwell (Mr. A. Anderson) called it "a mean little Bill," and the hon. Member for South Edinburgh (Sir W. Darling) "a contemptible Bill." I cannot enter into that competition of adjectives. I think it is just a workmanlike little Bill intended to cover a difficult period and to get over a particular obstacle at this moment. The remarks made by my hon. Friend the Member for North Edinburgh (Mr. Willis) about my colleagues from Lanarkshire looking forward tinder this Government to a period of mass unemployment are really, I suggest, a distortion of the very admirable and lucid argument that was put forward by my hon. Friend the Member for Motherwell. We are not looking forward under this Government or any other Government to the unemployment we knew so well in Lanarkshire between the war periods, but we are looking forward to regenerating Lanarkshire and regenerating Scotland, and this Bill is at least inadequate for any such purpose. It ties us down to the eleven-eightieths grant formula, and that is a formula about which no Scottish Members on either side should be in the least degree happy. I would appeal to the Under-Secretary of State for Scotland to say in his reply that

it is the intention of the Scottish Department to go into this whole matter with the Treasury in order that Scotland may get a fairer deal from the Treasury than she has received in the past.
I must disagree with my hon. Friend the Member for North Edinburgh, because the formula is not one that even the Under-Secretary claimed was an equitable one, but a formula which was reached, he said, by agreement with the local authorities concerned. The hon. Member for Motherwell pointed out that there was no adequate machinery whereby the assent of the local authorities could be obtained and that, in fact, the advantage undoubtedly lies with great and wealthy cities as compared with the depressed and derelict parts of the country. We are quite happy to accept this formula for this year, but I appeal to the Joint Under-Secretary of State for Scotland to tell us that he will go into the matter again in the hope that a new formula may be devised for 1946–47. In these conditions, I am sure every hon. Member will be happy to give the Bill support. But it is a very qualified support. None of us wants to boast about this Bill; we commiserate with the Joint Under-Secretary of State in having to deal with it.

7.11 p.m.

Commander Galbraith: My first duty is to congratulate the hon. Member for Central Edinburgh (Mr. Gilzean) on a very effective maiden speech. We have listened to him in the Scottish Committee on numerous occasions, and I think the speech we heard from him tonight contained just the kind of well reasoned arguments we would expect from him. We would look forward to hearing him on many occasions in the future.
I am sure that you, Mr. Speaker, will have been gratified in finding in the House tonight, on the part of the Scottish Members, agreement on two subjects. It is not usual to find that Scottish Members agree even on one subject, but tonight there has been complete agreement on the fact that the eleven-eightieths formula does not deal adequately with Scotland in connection with the rating position. I do not think there can be any doubt about that, following the argument which was put forward by the right hon. and learned Member for Hillhead (Mr. J. S. C. Reid). He seemed to me to prove conclusively


that the needs of Scotland are not being met adequately under the Goschen formula. I hope that, in view of the unanimity which has existed on the Committee, the Under-Secretary of State for Scotland, when he returns, will be able to press the Cabinet very strongly for more generous consideration in regard to the rating burden in future.
The other point on which there seemed to be unanimity of opinion was that the time had come when the whole question of local government finance required to be reviewed. I hope that, following this Debate, the Under-Secretary of State and the Secretary of State, when he returns, will press that matter very strongly. The burden has become almost intolerable at the present moment. There is no doubt it is going to increase, and the matter must be dealt with as one of urgency. I hope also that the Government will consider what they can do with regard to the Sorn Report, and whether the time has not come when legislation should be introduced to meet the findings of that Report. We are agreed on those things, but we do not seem to be at all agreed on the question of the allocation of this money which is to come to us. Various suggestions have been made in that connection, but I feel, with the hon. Member for Motherwell (Mr. Anderson) that what we want is that any sum that is coming to us shall be divided equally and equitably. I suggest, however, that it will take almost the wisdom of Solomon to satisfy all the Members from Scotland in that connection. It may be a trumpery Bill, a contemptible Bill, but still the relief given under the Bill is very much needed. While it might have been greater, it is very much welcomed at this time, and therefore, I hope the House will give this Bill a Second Reading unanimously.

7.14 p.m.

Mr. T. Fraser: I can speak again only with the permission of the House. First of all, I would like to congratulate my hon. Friend the Member for Central Edinburgh (Mr. Gilzean) and my hon. Friend the Member for Kelvingrove (Mr. Williams) on their very well informed maiden speeches. Both of them have had long experience on local government, and this evening we have been treated to the vast knowledge which they have acquired

of the problems of local government in their long periods of office. I am sure I am expressing the views of hon. Members in all parts of the House when I say it is our hope that we shall be privileged to listen to the two hon. Members very often in the future.
In the course of the Debate, hon. Members on both sides of the House seemed to have gained the impression that the block grant is allocated to Scotland on the eleven-eightieths formula. That is quite wrong. There has been a suggestion in the course of the Debate that we ought to get away from the Goschen formula when deciding on the allocation of the block grant. The position is that it was only on this occasion, because we did not find it possible to get together all the data to decide on the amount that would have been Scotland's due—I gave an assurance categorically that it would not be taken as a precedent—that we agreed to accept eleven-eightieths of the amount to be granted to England as an interim grant. We were satisfied, from the knowledge we had of the Scottish local authorities' accounts, that we had not come out of the bargain badly. Nevertheless, the right hon. and learned Member for Hillhead (Mr. J. S. C. Reid) rather criticised the Measure because he was sure we had not got our due share of the moneys being distributed at this time.
He quoted some figures indicating the differences in rate levels and valuation levels between England and Wales and Scotland, but I really think he got the position just a little wrong. He must know just as well as I do that a penny rate in England and Wales is equivalent to four-fifths of a penny rate in Scotland, and there are many decisions taken for the United Kingdom on that basis. He also said that local authority expenditure in England and Wales had not increased during the war years, but that is not quite true. The reason for the local authorities in England and Wales making their demand on the central Government at this time for additional money is that their expenditure has increased during the war years. I said in the course of my earlier speech that local authority expenditure in Scotland had not increased very much in the early years of the war, and it did not. The same was true of England. In many parts of England and Wales expenditure went down in the first three or four years


of the war, and that was equally true in Scotland.

Commander Galbraith: I think the hon. Gentleman will agree that my right hon. Friend was quoting the Minister of Health on the subject, and was not seeking to give a false impression, but was merely taking a quotation from the speech of the Minister of Health.

Mr. Fraser: That may be so. He also quoted the words printed on the face of the English Bill saying that the expenditure will rise in the years immediately ahead. That is equally true of Scotland. I suggest to the hon. and gallant Member that he might look at the Official Report of the Debate which took place on 30th November, and he will see that the English Members were not slow in informing the Minister of Health that the local authorities in England had indeed incurred increased expenditure during the war years. The average increase in rates in Scotland in 1943–44 over 1938–39 was 3d. in £, and the increase in 1944–45 over 1938–39 was 1s. in £.
While dealing with the points raised by the hon. and gallant Gentleman and the right hon. and learned Member for Hill-head, I will say quite categorically that the Government have no intention whatever of introducing legislation on the Sorn Report. The Sorn Report proposed a ceiling for owners' rates and we have no intention at all of introducing legislation to introduce that ceiling, appreciating that it can only be done at the expense of the occupier. The right hon. and learned Gentleman, when considering the levels of valuation in England and Wales as against Scotland, tried to prove how badly we were coming out of it. I gave earlier the average rate relief in Scotland as 7·7d. in the £ in the first year, 8·4d. in the £ in the second year, and 9.2d. in the third year. Allowing for the difference in the levels of valuation, these reliefs correspond to reliefs in England and Wales of 9·6d. in the first year, 10·5d. in the second year and 11·5d. in the third year. The actual reliefs in England and Wales under their Bill are 7·5d. in the first year, 8·3d. in the second year and 9d. in the third year. We are not coming out of this allocation of money as badly as hon. Members, I am afraid in all parts of the House, have suggested.

Mr. J. S. C. Reid: I do not think that I suggested we were getting less than our proportion. I suggested that our problem was very much more acute than the English problem and that, merely on the question of proportion, it got us nowhere.

Mr. Fraser: The block grant is not allocated at all on the basis of the Goschen proportion, and the allocation on the basis of that proportion this time is purely an exceptional measure. I have been trying to indicate to the House that we have got rather more than our share because the allocation has been made on the basis of that proportion. The Scottish local authorities seem to be fairly satisfied with the amount of money that has been granted to them under the Bill. There was a time when they asked for a certain sum of money; they asked for £2 million, but they did not expect to get it. Of that there is not any doubt. Under the provisions of the Bill they will get an average of £1,500,000 a year for the next three years. I can assure hon. Members that when I met the representatives of local authorities in Edinburgh there was no considerable complaint. There was murmuring here and there about the amount of money, but, generally speaking, it was regarded by local authorities as being satisfactory. They were applying themselves rather to the question of distribution.
My hon. Friend the Member for Dun-fermline (Mr. Watson) seemed to assume that this money was being allocated by the weighted population, taking into consideration unemployment. Unfortunately, others have complained that we are not doing that, and we are not, except in the case of the counties. The money being allocated to the burghs is on the basis, as to 50 per cent., of the comparative populations—not weighted populations, which take account of the unemployment figures for 1935–36, which are completely out-of-date—and as to 50 per cent, of rateable valuations. My hon. Friend the Member for Motherwell (Mr. A. Anderson) in criticising that formula called attention to the needs of Motherwell and Wishaw and other large burghs in Lanark-shire, and of the County of Lanark-shire, as against the needs of the City of Edinburgh. He quoted the figures which I gave in reply to a Question in the House the other day. He did not, however, make a careful analysis so that he might


inform us that of all the burghs in Scotland, Edinburgh gets the least rate relief. It gets relief equal to a rate of 5·6d. in the £in the first year, 6·1d. in the second year and 6·1d. in the third year. The Burgh of Motherwell gets a relief of 7·7d. in the first year, 8·4d. in the second year and 9·2d. in the third year. The hon. Member for Coatbridge (Mrs. Mann) also mentioned her constituency. Airdrie has a relief of 8·4d.in the first year, 9·3d. in the second year and 10·1d. in the third year. The Burgh of Coatbridge has a rate relief of 8d. in the £in the first year, 8·8d. in the second year.and 9·6d. in the third year. Taking Lanarkshire as a whole, I am afraid that the hon. Gentleman the Member for Edinburgh, South (Sir W. Darling) painted rather an accurate picture when he indicated that, whereas some of the large burghs in Lanarkshire and the County of. Lanarkshire as a whole were getting a total rate relief altogether by way of grant of something like £2 per head of the population, the City of Edinburgh was getting a rate relief of £1 per head of the population. These are telling figures.
It has also been said that one could not expect anything other than a Bill such as this because it was so obviously a Coalition Measure. The right hon. and learned Member for Hillhead and the hon. and gallant Member for Pollok (Commander Galbraith) know that it is not a Coalition Measure; it is a Bill that we had to produce after we took Office. Most of the consultations with the local authorities, and with the Treasury as to the amount, have taken place since we assumed the responsibility of Government. My hon. Friend the Member for Motherwell, in quoting these figures and making his argument for a review of this apportionment at the end of the first year—before we had paid over the money for the second and the third years—also dealt with the County of Lanarkshire, and the County of Dunbarton. There was a certain amount of inconsistency in his argument. When arguing for the burghs he said it was wrong to depart from the formula of weighted population and to bring in this other factor, that of rateable valuation. He criticised the allocation as far as it affected the counties because the whole of the county allocation was made on the basis of weighted population.

Mr. A. Anderson: I would like to correct that impression. The point I made was that on the population figure they got no benefit because of the fact that, while they had wide thinly populated areas they also had a highly urbanised area which negatived the density factor of their weighted population and so got the worst of both formulas.

Mr. Fraser: I am obliged to my hon. Friend. We have to look for a formula which is to be acceptable and equitable. There is a principle in the formula adopted by my right hon. Friend the Minister of Health which was wholly unacceptable to local authorities in Scotland. They would not have it at all. My right hon. Friend asked the local authorities in Scotland to propose themselves a formula that would be acceptable to them and that would be equitable in all respects. None of them found it possible to suggest to my right hon. Friend a formula more acceptable than the present one, and that formula has been adopted. I met them in conference in Edinburgh to see whether some other formula could be reached. We could not get any agreement at all; there was no other formula that got any measure of support from the other authorities. So far as Lanarkshire is concerned, I think it stood alone; no other county in Scotland was prepared to back Lanarkshire in the suggestion they made. Certainly, Renfrewshire and Dunbartonshire did not support Lanarkshire in the proposals they were making for the allocation of the money, and, likewise, the other counties, who had a great deal of sympathy with Dunbartonshire, as all of us have, because we see how badly she has come out of this formula, have been unable to suggest a formula which is acceptable to Dunbartonshire without being inequitable to the rest of the counties in Scotland.
I think those are most of the points raised in the Debate, but I might finish up by replying to the final point made by the hon. Member for Motherwell who asked whether we could have these provisions for one year, appreciating the urgency of getting something through. The hon. Member also asked me whether we could undertake to consider an alternative formula for the ensuing two years. Unfortunately, I cannot give that undertaking. We could not contemplate


further legislation in less than a year's time. The local authorities have agreed with us that all the necessary information will not be available, and indeed, that is why they agreed that this interim grant should be payable for three years, and not merely to the end of the present Fixed Grant Period. They agreed that all the relevant data would not be available to allow us to introduce permanent legislation until about 1947, so that there would be no point in my giving way now and promising to look at it again in a year's time.
There is no inequity in the distribution of the money among the large burghs, as has been suggested. If the suggestion of the hon. Member for Motherwell were accepted, so far as the distribution of the money among the burghs is concerned, then Motherwell would get more, and so would all the large burghs of Lanarkshire, but Edinburgh would get very much less, and it is well worth while remembering that each of the other cities in Scotland would get less. Glasgow would get less, if the hon. Member's formula were accepted. Dundee would get less, and where is there a city that has been harder struck by unemployment than Dundee? For these reasons, we feel we could not give way, and I do not think there will be any justification for taking this matter back to see whether we could get a more equitable formula for the last two years of the three-year period. In the circumstances, I hope the House will now agree to the Second Reading of the Bill.

Question put, and agreed to.

Bill accordingly read a Second time, and committed to a Standing Committee.

Orders of the Day — LOCAL GOVERNMENT (FINANCIAL PROVISION) (SCOTLAND) [MONEY]

Considered in Committee, under Standing Order No. 69.

[Mr. Hubert Beaumont in the Chair]

Resolved:
 That for the purposes of any Act of the present Session to provide for the payment out of moneys provided by Parliament towards local government expenses in Scotland of a further sum in addition to the General Exchequer Contribution payable under Section fifty-throe of the Local Government (Scotland) Act, 1929, in respect of each of

three years and for the apportionment of such sum among the counties and large burghs of Scotland, it is expedient to authorise the payment out of moneys provided by Parliament, of grants to local authorities in Scotland in respect of the year beginning on the sixteenth day of May, nineteen hundred and forty-five and of each of the two following years, of amounts representing respectively Exchequer contributions of one million three hundred and seventy-five thousand pounds, one million five hundred and twelve thousand five hundred pounds and one million six hundred and fifty thousand pounds."—(King's Recommendation signified.)—[Mr. Fraser.]

Resolution to be reported upon Monday next.

Orders of the Day — INDONESIA (SITUATION)

Motion made, and Question proposed, "That this House do now adjourn." —[Mr. Collindridge.]

7.36 p.m.

Mr. Driberg: I should like to start by expressing my gratitude to you, Mr. Speaker, and to Mr. Deputy Speaker, for not having called me to speak in the recent Debate on foreign affairs. At the time, I did not feel so grateful, but, as it has turned out, we have tonight considerably more time than we should have had on that occasion to discuss the very important matter which I want to raise.
The British people have learnt with dismay and concern that, four months after the end of the war in the Far East, British and Indian troops are engaged, and are suffering heavy casualties, in a war in Indonesia and in French Indo-China—a war whose object appears to be the restoration of the status quo in the Dutch and French Empires in that part of the world. Their dismay is not lessened when they learn that we are also employing Japanese troops in the action there. Indeed, it was only yesterday, I think, that one of the military spokesmen was reported in the Press to have said that the action in Indonesia is about to develop into a major military operation, and, as we all know from the reports, heavily censored as they are, Indonesian villages have been burned and attacked with rockets—and only those who have been near the receiving end of a Typhoon rocket know what a terrifying weapon it is—and there is every indication that this is not a mere trifling or guerrilla campaign, but something quite important.


I have referred to Dutch Indonesia and French Indo-China. The circumstances in these two territories are not precisely parallel, of course, but there are certain resemblances between them. The situation in Indonesia is much more acute, and the disturbances there more widespread, and I shall, therefore, confine my remarks mainly to that country, but one should, perhaps, remark in passing that, if anything, French Imperialism in Indo-China was more oppressive and backward than Dutch Imperialism in Indonesia.
When the Foreign Secretary dealt with this subject in his great speech, if I may so describe it, in the Foreign Affairs Debate, one point that I noted with pleasure was the tribute that he paid to all ranks in the British Forces serving in that part of the world; I should like to echo that tribute, and to pay, in particular —though this perhaps may seem, to some hon. Members opposite, to come strangely from these Benches—a special tribute to the British commanders on the spot, because I know that the troubles that have arisen there are no fault of theirs. They have done their utmost in the way of conciliation, but they have been handicapped throughout by intransigeant and unwise political directives emanating originally from Paris and from the Hague. If it had been left to the judgment and the discretion of the commanders on the spot to settle this matter, I believe that an amicable solution could have been reached without bloodshed, and both Indonesia and Indo-China might now have been well on their way towards obtaining self-government by peaceful means.
The evidence of that is manifold. General Aung San, the Burmese Nationalist resistance leader, has paid repeated tribute to the wisdom and liberality of the policy pursued by Admiral Mountbatten. Again, in Indonesia some weeks ago, when the Dutch were at their most difficult, General Christison was meeting and having dinner with Dr. Soekarno the Indonesian Nationalist leader. Again, in French Indo-China I know, from my own firsthand observation, that General Gracie did his utmost to get agreement on the spot before the trouble actually flared up, and the trouble only flared up in Saigon, late in September because, in effect, General Grade was double-crossed by the French commander on the spot.
Moreover, it should also be said that most of the objectives for which British troops entered these territories were harmless and even laudable—the recovery of prisoners of war, the disarming of the Japanese forces, the taking over of Japanese headquarters, and so on—and when the British troops first went in to carry out those tasks, they met with no opposition or resistance at all from the Nationalists, but, on the contrary, offers of co-operation. I believe that in some cases those offers were made use of. I hope sincerely that that can be done again, and that we can invite the Nationalists, so far as possible, to assist us in those primary tasks—the recovery of prisoners of war and the disarming of the Japanese. I believe that many hundreds of lives of prisoners of war and of internees, as well as of troops, could be saved if we could get and use the full co-operation of the organised Nationalists in doing that. It was only when the final part of the assignment began to become evident, and when the Nationalists realised that one of the objectives was the maintenance of law and order until the Dutch and French civil governments could be restored, that they began to get restive. So one of the questions I would ask my right hon. Friend this evening is this: what exactly are our commitments to the Dutch and to the French, and from when do they date? Are they a legacy from the Coalition Government? Were they commitments entered into during the war, when, of course, the Dutch were our Allies—as they still are—and fought very gallantly on our side? Or are they new commitments? I ask this because some of the more responsible American newspapers have published a fairly detailed account of the alleged signing of a pact on this matter between the Foreign Secretary and M. Massigli, the French Ambassador, within fairly recent months; so I hope that my right hon. Friend can shed a little light on that.
It may be said—it probably has been said—by some of the Dutch and French spokesmen that we have no right to interfere in the domestic Colonial policy of Allied Powers, and to tell them what to do, and to say to them, "You must give these territories their freedom straight away." I suggest that we have established such a right for two reasons. In the first place it is our troops who have the distasteful, unenviable task of doing


this job and sacrificing their lives; in the second place, we have shown, in our handling of a somewhat analogous problem in Burma, that we, at any rate, know how to handle such problems in that part of the world. I do not say that I am altogether satisfied with every aspect of the situation in Burma at present, because I am not, but at least there has been no bloodshed there, and at least it can now be said that Burma is clearly on the way to self-government and independence within a clearly defined number of years. That is the very least we are entitled to demand on behalf of the Indonesians and the Annamese from the Dutch and the French Governments respectively. There was one passage in the speech of the Foreign Secretary which I particularly liked, and that was his very understanding reference to so-called rebels. He said that the sensible thing to do with so-called rebels was to talk to them in a friendly and man-to-man way, and he reminded the right hon. Gentleman the Member for Woodford (Mr. Churchill) of at least one erstwhile rebel known to him, who had now become a great Empire statesman.
Now I come to what is really one of the crucial points in this argument, and that is the terms of the Dutch offer to the people of Indonesia. My right hon. Friend the Minister of State said a week or two ago at Question time that that offer went very far and was extremely liberal. I know he was only answering a supplementary question at the time, and I hope he will be able to tell us tonight that he has now analysed the offer rather more scrupulously and has discovered that it really does nothing of the kind. The terms of this offer became known on or about 6th November—a month ago—and, in very broad outline, here are a few of the main points of the Dutch offer as transmitted to the Nationalists by Doctor van Mook—whose position throughout this matter has been one of extreme difficulty, because he himself takes a liberal and humane point of view about it, but he is constantly being called to order and rebuked, even publicly, by some of the more intransigeant upholders of the status quo in the home Dutch Government.
Some of the main points of the offer are these: that Indonesia in future is to be "a partner in a kingdom." Now that, I suggest, does not correspond in any way to our Dominion status. Another main

point is that there is to be a representative body, with a majority of Indonesians on it, and a Council of Ministers, under the Governor-General as representing the Dutch Crown. Further, so far as one can gather from the rather obscure language in which this offer has been reported, this representative body and the Council of Ministers are to deal almost exclusively with the internal affairs of these territories. That suggests an arrangement analogous to the present situation in Ceylon, which again obviously falls far short of anything comparable with Dominion status. The question of the suffrage even is not cleared up in this remarkable offer; the offer merely says that the question of the suffrage "will receive further consideration." Finally, it is made absolutely clear that all final decisions on matters of major policy are to be taken at The Hague.
I really do not think that can be described as an extremely liberal offer which goes a very long way. I would refer my right hon. Friend to the despatch from the special correspondent of "The Times" which appeared in that newspaper on 7th November. If he has any difficulty about looking that up, it should be said that there were apparently two editions of "The Times" on that day—as there are of most newspapers on most days—and the dispatch appears in an abridged form in some editions. I think, incidentally, that we can assume that the special correspondent of "The Times" who sent that report is Mr. Ian Morrison—a highly responsible journalist and authority on the Far East, whose admirable and well-balanced book, "Malayan Postscript," will be known to many hon. Members. "The Times" special correspondent's comment on this Dutch offer was that two months ago it might have done some good.
 To-day, with tension rising all over Java, with shots ringing out in Batavia each night, and with nearly everyone—especially the Dutch—thinking in terms of war, such a statement signifies little.
He then goes on to comment—

The Minister of State (Mr. Philip Noel-Baker): What was the date of that despatch?

Mr. Driberg: The 7th November. He He then goes on to analyse the Dutch statement in general terms and he says, with quiet irony:
It is more full of loopholes than most official declarations of policy. Nearly all its


provisions, when put into plain language, represent either pious hopes, …. obvious statements of fact, …. or evasions of the issue. Even the proposed round table conference is to have only advisory powers. No dates are given, and nothing specific is said about elections.
That is the offer described in this House by the Government spokesman as being extremely liberal and going a very long way. I am afraid that I canot agree with that description. The very least the Dutch could offer now is something comparable with Dominion status, and I am not sure that it is not too late even for that—the situation is so tragic and so tense.
The latest information which I have, apart from the newspaper reports, is in a letter dated 17th November written in Indonesia by a well-known Dutch Socialist there, Mr. de Kadt. This man was interned during the Japanese occupation and is a friend and associate of Mr. Sjahrir, the Prime Minister of the new Indonesian Provisional Government. I will not quote the letter in full, because it is very long, but there are one or two sentences in it of special interest and significance. He says:
 People in Holland have apparently no idea of the way in which the Nationalist Government, in spite of its weaknesses, now holds power.
He goes on to say:
 I have gone to Batavia because it is the political centre. Bandoeng is practically isolated, for posts, cables, telephones do not operate for Europeans any longer; neither do railways or motor traffic. Thus you can see the position of Europeans in Java.
He is writing, by the way, to a friend and comrade in the Socialist movement in Holland. He says:
 Probably it is already too late for complete Dominion status (with the right of separation). There is only one solution, the recognition of independence and an effort to make an agreement for future co-operation between Indonesia and Holland on that basis. There is still a chance for a far-reaching alliance of equal and independent States, but every day of hesitation loses one more chance for this favourable solution. 1 have been in touch again with Mr. Sjahrir [the Prime Minister of the Provincial Government], whom I respect very much. He has mentally matured (luring the years of exile and occupation, and in my opinion he is the one man who can bring about a satisfactory solution.
Then he goes on to make a perfectly frank admission which could well be taken by opponents of the Nationalists and used against them, but it is better to have all

the facts of this difficult and tragic situation out frankly in this House. He says:
Sjahrir will have a difficult time with the terrorists, Fascists and rascals around him who want to use the nationalist movement for their own ends, and are working among the masses of the people, intriguing and causing trouble. Of course, there are none of these elements in the Cabinet, which is not only respectable but very capable. Sjahrir's struggle against corrupt Fascist and terrorist elements is necessary.
The point is sometimes made by official Dutch spokesmen that these so-called Nationalist leaders cannot control their own extremists and terrorists. We all share in the condemnation which the Foreign Secretary expressed of the acts of terrorism committed by extremists in Indonesia. But the way to enable the responsible Nationalist leaders to control their extremists is to recognise them as such. While they have no status and are not recognised by the Allies, how can they exercise control? That is the way to enable them to do so.
One more point from this Dutch Socialist in Indonesia. He says:
 The problem is to make an agreement which will give economic and cultural chances to the Netherlands in the future. But this can only be done if people in Holland are reasonable enough to understand that the period of their political power is ended.
One ether Dutchman in Indonesia recently came out publicly with a statement on behalf of the Indonesian cause, a man well known in circles in this country interested in serious documentary films—Mr. Joris Ivens, who was one of the producers of that great film, "Spanish Earth." He was employed by the Netherlands East Indies Government as film adviser, or in some such capacity, and he has just resigned that post, saying publicly that his reason for doing so was that he could not continue to associate himself with an administration which was plainly trying to reimpose a mere status quo on an advanced and intelligent people with strong National aspirations.
I want to end with two constructive suggestions. First, that there should be a conference held, away from the inflamed atmosphere of the Netherlands East Indies. There has just been a conference in Singapore, but I am sorry to see—so far as one can judge from the reports—that no representatives of the Nationalist leaders, either of Indonesia or Indo-China, were present. It was reported as a conference between ourselves,


the Dutch, and the French. I hope that the right hon. Gentleman can tell us a little more about that conference and its results, and what the possibilities are of holding another conference—perhaps even in London—at which the Nationalist leaders would be treated as equal parties with representatives of the French and Dutch, and at which the whole thing can be thrashed out in as calm a way as possible.
If the Dutch—I hope they are not—but if they are still making that foolish remark that "We cannot do business with Quislings," perhaps I might just dispose of that allegation in passing. I am glad to see that the responsible newspapers no longer refer to these Nationalists as Quislings, because, of course, although it is true that in some cases and at some times during the war, some of the Nationalist, elements co-operated with the Japanese, they never did so for the reasons for which the Quislings in Europe collaborated with the enemy, and, above all, they never betrayed their own people. The definition of a Quisling is surely somebody who betrays his own people. The Indonesians and the Annamese Nationalists were only concerned in getting independence and freedom for their own people, and they thought, mistakenly, that they could use the Japanese as a means of getting freedom from the Dutch and the French. Furthermore, in the new provisional Cabinet of Dr. Sjahrir, there is nobody who could, even by a twist of language or imagination, be described as a collaborator or a Quisling. On the contrary, every member of this new Cabinet has a most admirable record of resistance against the Japanese during the period of occupation.
My second suggestion is that whether or not such a conference as I have suggested can be arranged, this whole situation might be handled under the transitional security arrangements provided for in Article 106 of the United Nations Charter. It will be remembered that the great Powers have power in such a case to co-opt other Powers to join in the discussions. No doubt, if that were done in this case, such Powers as Australia and China would be brought in. I hope that that will be seriously considered. It does not in any way offset or contradict my previous suggestion of a conference. The

conference is obviously the short-term, urgent way of dealing with the situation. The other would take longer. If it is said that this is not a suitable subject for reference to the U.N.O. under these arrangements, one might ask what is—because if this is excluded, any of the many dangerous situations which are boiling up, in the Far East in particular, could be excluded.
One might perhaps adapt, very slightly, an old rhyme, and say:
In matters of. Empire, the fault of the Dutch
Is yielding too little and grabbing too much.
The Dutch have gained vast wealth from the peoples of Indonesia, and they have done remarkably little to allow or to encourage their aspirations towards independence. The whole of South-East Asia is now astir. The whole Far East, as my right hon. Friend knows well, is the real danger area in the world today. I hope that the British Government will deal with this whole situation with the highest wisdom and statesmanship, and with a realistic recognition of the strength of the new forces that have arisen. The only alternatives before them in Indonesia are either to recognise the Provisional Government of Dr. Sjahrir, with everything that that implies, or to conduct a full-scale war for the repression of Indonesian independence. I do not believe that the British Government, or its supporters in the country, can regard the latter alternative with equanimity.

8.4 p.m.

Mr. Zilliacus: I wish to support very strongly the plea that this question should be dealt with as a matter of international concern. There are good reasons, both negative and positive, why this should be done without any delay. On the negative side, it is not fair to ask this country alone, after six years of world war, to bear the material and moral burden of armed intervention in Indonesia or Indo-China. We are desperately in need of all the men we can get home, as quickly as we can get them home, to restore our industries and switch over our life to a peacetime basis. Moreover, after six years of war, the men still out there in the Far East have their minds filled with the thoughts of coming home. I do not think it is fair to put them into the firing line again, in a new war which


was not in the contract. That is one of the negative reasons.
The other negative reason is that what is happening in Indonesia and Indo-China, and the part we are being forced to play in those events, are being viewed with gathering disapproval, not only in certain sections of public opinion here, but by our principal Allies. There is no doubt at all about Chinese and Soviet disapproval, and the American Press has shown pretty lively criticism of what is going on now in those areas. It is not only the American Press. Our own newspapers have reported the statement made by Mr. James Byrnes, the Secretary of State for the United States, in which he declared that the United States were prepared to mediate, 'but would not intervene by force in this situation. He added that the United States disapproved of the use by British and Dutch troops, for political purposes in Indonesia, of American Lend-Lease arms. That is a pretty clear indication of American opinion on this matter. Indian Nationalist opinion is also very strong. That is a second very powerful negative reason why this matter should be treated as a matter of international concern, and not as a matter of either exclusive Dutch, or exclusive British or exclusive Anglo-Dutch concern.
A positive reason is that these territories were liberated by inter-Allied action, as part of our common cause, as part of our war against Japan; and as the Secretary of State for Foreign Affairs declared in his last great speech on foreign affairs, our troops went into Indonesia as the mandatory of the Allies, to carry out a mission entrusted to them by the Allied Commander-in-Chief. They went in to wind up the war against Japan, notably to disarm and bring out of the country the Japanese troops, and to get out of the country our own prisoners of war, who, by this time, I believe I am correct in saying, have all been brought out of the country. If that is the case, if we went in there as part of the winding-up of the war waged by all the Allies against Japan, and as the mandatory of the principal Allies, surely this situation should now be referred back to the principal Allies, because it is getting out of control. We went in originally for a limited military purpose, and we have been involved in this situation for a very large

and undefined political purpose, which may easily grow into nothing less than an attempt to reimpose Dutch rule by force of arms on a population as great as the population of this country. That is a very large military enterprise, and will be viewed, to put it mildly, with a considerable lack of enthusiasm by the people of this country.
The final positive reason why this should be treated as a matter of international concern, is that the future of all these liberated territories between India and China is very much bound up with the whole future peace settlement, particularly the peace settlement in Eastern Asia, because these territories all have a common characteristic. They were Colonies, and are now liberated territories with strong nationalist movements and very definite aspirations to evolve into States with national independence. A corollary of national independence in the world today, is membership of the United Nations Organisation. In one way or another, we should work for a settlement which contemplates the achievement of independence by those liberated territories—call it independence or Dominion status. It does not matter what it is called, provided that it qualifies them for admission as member States of the United Nations Organisation.
If you adopt that principle and regard this matter as a matter of international concern, you have, thereby, given a guarantee to the nationalist movement and its leaders, because you have already satisfied their main demand, which is their claim to the status of an independent community. By doing that you will make it easier to negotiate arrangements with them for maintaining law and order during the difficult period of transition, because it looks as though the situation there was degenerating to a point at which a certain amount of foreign force will have to be used for a certain period to restore order, and even to restore the authority of the existing Government. That can only be done by the forces of this country or of Holland, and it can only be done properly as part of the action of the Untied Nations, bound up with a recognition of the claims to status as a member State, of the Indonesian Nationalist Government.
I am not concerned with the forms in which the United Nations Organisation should be invoked in this matter. It


could be brought before the Assembly, and the Assembly asked to appoint a Committee to deal with it. Or we could invoke, perhaps even more conveniently, Article 106 of the Charter providing for transitional security arrangements. This Article provides, in substance, that, pending the coming into existence and operation of the Security Council, the principal Allies, who are permanent members of the Security Council, should take such joint action on behalf of the Organisation as may be necessary for the purpose of maintaining international peace and security.
I should like, although I think it is unnecessary, to remind the Minister who is going to answer for the Government, of the great danger of adopting a position which argues that the Charter is not a fit instrument to be applied in a situation of this sort. We had a great deal of that in the days when Lord Simon —Sir John Simon as he then was —used the utmost resources of forensic ingenuity to prove, not that the Government were unwilling to use the Covenant of the League in the Sino-Japanese conflict, but that the Covenant could not be applied, and that it was not the kind of instrument to apply. I plead very strongly against any arguments that the Charter cannot be used and invoked in this situation. If that argument were proposed by a Labour Government, it would strike a fatal blow at the prestige of the United Nations Organisation on the eve of the first General Assembly, in which the nations of the world are to pledge their faith in this new instrument. Therefore, I ask the Government to treat this as a matter of international concern and to find some means, perhaps through Article 106 of the Charter, or an appeal to the Assembly, to bring into operation the machinery of the United Nations Organisation in this conflict.

8.14 p.m.

Major Wyatt: I would like, very briefly, to support the remarks made by my hon. Friend the Member for Maldon (Mr. Driberg). The particular aspect I want to stress is the use of Indian troops. The use of Indian troops has had a most unfortunate effect on public opinion in India generally, as anyone can see who has followed the Press in India and the speeches of Nationalist leaders. It has given them

the impression that Indian troops have been used without consultation with the Indian people to prevent the legitimate aspirations of the Indonesians being realised and the result of that has been to make many Indian leaders feel that, perhaps, this is a foretaste of our future policy towards India, which, of course, we know it is not. But the use of Indian troops in this way has given that impression. Also, the official Government statements on this subject have not been couched in as sympathetic language as they might have been. If they could only have contained passages of sympathy to the nationalist aspirations of the Indonesians, saying that the Government felt they were fully justified, that would have eased the situation a great deal. The Government should have been able to make it clear to India that the use of Indian troops is only a development of the fact that India herself is a great Power in the Indian Ocean area, and that India is going to have to play her share in settling the affairs of that region. It was a pointer which could have been used to indicate the future responsibilities of India as a self-governing country.
I would like to suggest that we should set up, straight away, a Regional Council to deal with the affairs of the Indian Ocean area. We have got past the days when the Powers in Europe, or we from Whitehall, can presume to settle the affairs of the Far East, or individual countries there, without consultation with the leaders of the countries concerned. If we were to have a Regional Council on which were represented France, Britain and Holland and also the national leaders of India, Indonesia, Burma, Malaya and French Indo-China, further occurrences of this kind could be avoided, because they could all get together and settle the problems themselves. If we had had one in being at the end of the war with Japan, this unfortunate trouble in Indonesia would not have happened.

8.17 p.m.

Major Niall Macpherson: It seems to me that we must treat all the Allies on the same basis, and I propose, first of all, to put this point. Undoubtedly, it was by an international agreement that we went into Indonesia. Unfortunately, we did not find things exactly as we expected to find them. We naturally expected, when we went to


liberate a country, that that country would accept our liberation. As far as I know, that liberation is not yet complete. The task we set out to do is not yet finished. If we are going to secure it against future Japanese aggression, there are steps which remain to be taken. Our task, therefore, is extremely complicated.
Unfortunately, we have here the same kind of situation that we ourselves might be faced with within the British Commonwealth of Nations. It has been clearly stated from the Government Front Bench that we will not allow the independence of any parts of the British Commonwealth to be vindicated by force, and it seems to me that that is exactly what is happening here. We have gone into this territory with the object of helping our Dutch Allies and with the object of freeing the Indonesian people from the Japanese. Had the war not ended so suddenly, I suppose —and I would like the Minister to confirmthis—it was intended that Dutch troops should participate in the liberation, and that they would, by now, have gone there so that the situation would have been much easier. I would like to ask the Minister whether it is still intended that Dutch troops should go there. If we accept the position that we should not submit to force within our own territories, I find it very difficult to see how we can deny the same position to our Dutch Allies. Part of this difficulty, it seems to me, arises from the time it has taken to establish the United Nations Organisation.
I fully agree with the hon. Member for Gateshead (Mr. Zilliacus) that this is a matter for international settlement and I think it is a matter that may very well at the earliest opportunity be committed into the hands of the Trusteeship Committee. But in the meantime what have we to do? We are there to accomplish a task which has been, as it were, left over from the hostilities and has not yet been completed. How is that to be accomplished? Surely this is a task that cannot be determined by one side only and by force; and unless and until the Indonesian Government are prepared to cease hostilities of all kinds and come round a council table, it seems to me that we should refuse to enter into negotiations. I put that point, and, as the same kind of circumstances might easily have arisen within our own Dominions and Colonies, I think we would be very vulnerable in-

deed to criticism if we were at this time to yield before force rather than request the representatives of the opposition that we are now meeting, to come round the council table and settle the matter by negotiation.

8.21 p.m.

Mr. Platts-Mills: I would like briefly to add to the contributions already made to the Debate. Myhon. Friend the Member for Maldon (Mr. Driberg) gave the Indonesian National Government and its cabinet a good reputation. May I introduce them in a little further detail? The members of this cabinet are men who are known as established figures throughout Indonesia and in Holland. I will not introduce them all, but typical is the Home Secretary, or the Minister for the Home Office, Wiranata Kusuma. This man was a regent; that is to say, he was the governor of a province in this island with a vast population of 40,000,000, appointed by the Dutch. For many years he had been such a regent. More, he was chairman of the Council of Regents; that is to say, he was the outstanding, best known and most important of the regents appointed by the Dutch themselves to administer such local autonomy as the Dutch allowed to these people. When a man like this goes on to the National Indonesian Cabinet, it must mean that the whole body of the regents are supporting him. He could not do otherwise. At the Foreign Office there is Ahmad Subardjo, who is a lawyer trained at Leyden, where all the famous Dutch lawyers are trained. He is known throughout the world by those races who have struggled for independence against foreign subjection. He was the representative of Indonesia at the Brussels Conference against Imperialism in 1927, and at a similar meeting in 1929 at Frankfurt in Germany.
The Minister of Justice is Dr. Supomo, another product of Leyden. This man held the minor position of chairman of the Indonesian high court. He resigned that position—he is not a young man—and became principal or the head of the Faculty of law at Batavia. This man, if you like, cannot be dismissed as no one at all. He is a leading lawyer who held the highest judicial position in the country under the Dutch. Who is more suitable as the Minister of Justice under the new national regime? May I turn to


finance? We have Dr. Samsi. Where do we go to get our best advice on finance for our new Government?—to the Governor of the Bank of England. We take him gladly into our collaboration to deal with our most vexing problems. Dr. Samsi was the director of the National Bank of Indonesia. It is not a national bank that these raw natives have set up, but the National Bank of Indonesia established by the Dutch to administer their great Imperial oil interests. That is the man they have taken on. He has given his service and will continue to give it when that Government is accepted by us. He was a close friend of Van Kleiffens, although many of us on this side of the House will probably doubt if that is much of a testimonial. Mr. Ki-Hadjar, the Minister of Education, has set up under his own authority, as the chief Indonesian educational officer under the Dutch, 17,000 schools for the Indonesian people. Do they respect this man, is he of any standing in that island? Is he a tit person to fill the position of Minister of Education? I do not put it against this man, but he was exiled for ten years after his great successes, because he wrote a satirical book called, "When I was a Dutchman."
Having introduced this Cabinet, and the men we shall have to deal with when this Indonesia is finally established as an independent nation, may I say one word by way of a humble request for information about the obvious confusion both in our actions and in our information as it is disclosed to us in this House? We are there, so my right hon. Friend informed us during the great foreign affairs Debate, for three purposes—to disarm the Japanese, to free our prisoners of war and to release those who were interned. That was, apparently, the situation a week ago. But was it so? It is on this point that I would like information, two months ago every British prisoner of war was released. Six weeks ago we were informed that the same position still held. My right hon. Friend the Minister of State said that. The Prime Minister told us the same. I think the Secretary of State for War told us that, and again on 31st October the position was confirmed by my light hon. Friend the Foreign Secretary, who said that 2,497 Commonwealth prisoners of war had been evacuated, that every one was released and that 256 had remained behind in the country of their

own will, because their assistance was being used to identify war criminals amongst the Japanese. We are obviously not staying there to release prisoners of war.
Are we staying there to disarm the Japanese? We were told by my right hon. Friend the Prime Minister on 17th October that, in the first instance, we were using the Japanese to preserve law and order in the emergency created by the sudden collapse of the Japanese resistance. There has not been an official word about the use of the Japanese forces by us against the Indonesian people until today when the Supreme Commander in the area reports, as a result of the disclosure by Mr. Edward Murrow, the Colombia broadcasting reporter, that, in fact, we were still using the Japanese in active offensive warfare. We had this admission —and I invite the attention of hon. Members to its precise terms—that we were using the Japanese, but only for static defence and also for defence when the lives of Allied internees and prisoners of war are in danger from Indonesian extremists. I want the House to appreciate the position—static defence of internees who are in danger. I want hon. Members to picture the static defence area, placed where you will, and beyond that, Indonesian extremists with internees still in their grip, the Japanese forces statically defending as they move forward to assail the area, where, it is suggested, the extremists are imperilling the lives of internees. The Supreme Commander in that area added that these Japanese were being used for the static defence of prisoners of war, but we know they are not in captivity. They are all released and have left the country, except those who have remained behind for quite express professional purposes. Is it not prefectly apparent when we say that we are there to disarm the Japanese that we are speaking like the unhappy French children who murdered their parents and who, on their trial for murder, pleaded for mercy and said: "Have pity on us for, unhappily, we are orphans." Here we are deliberately keeping the Japanese under arms for some purpose that is confused, on the information that we have been given, and then saying that we must stay there until we have disarmed the Japanese.
We can say that for ever. Let us take the island, and set up a governor, and if


anyone wants the job let us have some offers. The island is ours, so long as we keep the Japanese fully armed, as we appear to be doing. The course to be taken is that we should say to the Indonesian Cabinet, "We want the release of the internees." Has any approach been made of that kind? When it was a question of releasing our own prisoners of war, their positions were identified by the Japanese. The Prime Minister said in the House on that day that the identity of their positions had been established, and they had been released. It is clear that the Indonesians do not want to keep the internees against us, but we keep them to defend them against the Japanese, who are still in arms, and not unnaturally.
I would tell the House of another point of confusion. The right hon. Gentleman said in this House, on one dramatic day when a famous and distinguished officer had been shot, that this was a dastardly crime, and he associated it with Indonesian extremists. Was it not the fact that this distinguished officer was shot by a stray bullet when he was being driven in a motor car, to a meeting indeed, and in that very area where there are so many armed Japanese, our bitterest enemies? Can we not at this stage have an understanding as to how that officer died, and whether it is really suggested that it was other than our Japanese enemies, kept armed by us, who killed him? That was the tragedy of the whole thing. There is one further point I would like to make, supplementing what was said by my hon. Friend the Member for Gateshead (Mr. Zilliacus). It is suggested that there is some agreement with the Dutch that requires us to be there. The agreement has never been published. My right hon. Friend the Foreign Secretary a week or two ago said, "It is clear that there must be an agreement between us and the Dutch." That is not fair to this House. If there is any such agreement it cannot override the Atlantic Charter or the Charter of the United Nations.
I ask whether it is suggested that there is some agreement, kept secret so far, which requires us to be there and to intervene in what is becoming a bloody war on behalf of the Dutch Empire. It is not a case where the peace of the world is threatened. The peace is broken, destroyed already. The war is on. In early October there had been three British

casualties. Two days ago there had been 46. The total now is over 1,000, of which 200 are dead. I am giving the roughest figures which are in the possession of this House already. It is urged that this matter must come before the United: Nations Organisation. The only conceivable grounds on which it could be withheld from the jurisdiction of the United Nations Organisation, I mean the transitional body that it has set up for the express purpose of dealing with precisely this situation, is set out in the discussions, we had in Moscow. It was there said that a situation might arise for maintaining international peace and security pending the re-establishment of law and order and the inauguration of a system of general security. That is the very situation which is there today, and which was legislated for in Moscow in 1943, and in Article 106 of the Charter. The only reason that could be advanced, surely, for withholding this matter from that organisation, that interim security procedure is this: it could not be said that this is an international matter. It is solely a matter between the Dutch and their subject people.
Be it so; what follows? Our lads are there on behalf of the Dutch. They are carrying out Dutch policy. If this is not a matter of international concern, our lads—this means Finsbury lads—are there as hirelings and mercenaries of the Dutch. They are mercenaries of the kind that the German princelings used to hire out in Europe. They used to charge the same price per head for them, when they crossed their territory, as they charged for the transport of cattle. Our lads are treated in that way and the only pay they get, those Finsbury lads, is the pay which every mercenary expects, and that is death. It has been reported officially in the Press that 46 two days ago-had paid that price. That is not a matter between the Dutch and the Indonesian people; it is an international matter.
As my hon. Friend the Member for Gateshead said, those people were liberated as a result of international action. The Secretary of State said, on 3rd December, that we were going there because of a duty which had been allotted to us expressly by the Supreme Commander of that area. What is more, when those people have established their freedom they will come into the international field and we shall have to accept them. It is an


international problem from every point of view. What will be the result if we persist in this armed intervention, when no case for it can be shown? We shall not only discredit our own moral standing as a nation but we shall be leading to this great world organisation, to which all the peoples are looking with hope, being stillborn, for this is the very eve of its birth. Are we, on this great day, to advance legalistic arguments to prove that we cannot bring into action this magnificent machinery that has been set up already for this very purpose? I assert that we should be given an answer why a truce should not be called at once and a conference opened.

8.38 p.m.

Mr. Gallacher: I associate myself with the speeches that have been made on this question of Indonesia. In regard to the remarks made from the other side of the House, I must point out that tomorrow and the next day we shall be discussing a loan from America. About 100 years ago Americans were battling against the British troops for independence. If you look at the Press you will find that they were called rebels, gangsters and murderers and that every vile term was used about them. We are getting a loan from them tomorrow. In the last war there was a battle for independence going on in Ireland. If you look at the Press you will find that those people were gangsters and murderers and that all the vile terms were used against them; but they were invited over here to discuss an agreement.
I say to the Lord President of the Council that the Indonesians have as much right to liberty as the Americans had. When the Indonesians looked for liberation, it was liberation not only from the Japanese but from enslavement to the Dutch Imperialists. We have no right to be there preventing them from getting liberation and independence. We often hear a lot about Liberal principles and about listening to the voice of Liberalism, but in a case like this where people are fighting for independence, we hear all this talk about "You can't get independence by force." How will they get it? If they do not use force against the forces of the Dutch Imperialists, how are they to get independence in the existing situation? They will get independence anyhow. It does not matter how long

we stay there, we can never hold back the spirit that is alive, not only in Europe but throughout the whole world today. The peoples are marching forward to freedom and independence.
The other thing I want to draw attention to—and I want the Minister particularly to pay attention to it—is that I put down a Question to the Secretary of State for Air arising out of a letter I received from the mother of a lad in the Air Force. When the war was over she expected her boy to come back to her. Where is her boy? He is in Indonesia. She does not want him there; she wants him home. She was quite agreeable to the boy fighting against Nazis, but she does not want him to be sacrificed fighting against people struggling for independence. Neither the Minister nor the Labour Government can justify before the people of this country, or before the people of any country, the sacrifice of one British life to maintain Dutch or any other kind of Imperialism in Indonesia, or anywhere else. The Labour Government should withdraw the troops in Indonesia, and the Indonesian problem will be solved. If we withdraw our troops, there will be no fighting because the Dutch are quite incapable of continuing the fight. The situation will ease when the British troops are withdrawn.

8.41 p.m.

Mr. Evelyn Walkden: If I do not follow in the fashion and with the vigour with which the hon. Gentleman the Member for West Fife (Mr. Gallacher) has just spoken, it is not because I do not feel the same kind of sincerity that he invariably expresses. We, the fathers and, I suppose, one can speak of the mothers, and sweethearts and the wives, whose relatives and kith and kin are in Indonesia or in those zones, feel that somebody somewhere has made a mistake. We feel that the Dutch have handled this matter clumsily, and it is not the first time they have handled matters clumsily. We know, and I think it ought to be said, because most of the people who have spoken on this subject following the hon. Gentleman the Member for Maldon (Mr. Driberg) who raised it—and, I think, in a right and proper manner—have been Socialists, Socialists have spoken strongly on this subject. We are not unmindful that in Holland there is a Government which has handled other problems in a


clumsy fashion in its own country, never mind in its Dominions. We know that the vast majority of that Government are Socialists. You may think this is a pretty kettle of fish; a Socialist Government in Britain offering strong and vigorous criticism against a Government in Holland which is made up in the main of Socialists. By contrast, the Conservatives sit silent, dumb, and wonder what it is all about.
So far as the Dutch are concerned, we believe there is an avenue awaiting us that really allows for a line of approach such as that mentioned by the hon. Gentleman the Member for Gateshead (Mr. Zilliacus) and by the hon. Gentleman the Member for Maldon which can avoid further bloodshed. We believe that if the "get together" spirit prevails or is created as the result of this Debate, the Debate will have been worth while—as most Debates are which are raised by this side of the House. As one who visited Holland some weeks ago, I was aware of the misgivings, the doubts and the fears on the part of the Socialists in Holland concerning their Government and the way they were handling their problems.
Not all the Socialists, the trade unionists or the Social Democrats are happy about the way the Dutch have handled their own peculiar situation in their own country. To give a little illustration, they have 85,000 collaborators—and I have mentioned this to my right hon. Friend before —behind barbed wire. These collaborators, some of whom may have been released since I was there, were put behind barbed wire for lots of reasons. When a country is occupied by an enemy, those who feel they were the Maquis, the resistance movement, or worked with the liberators, begin to work off their spite on people they do not like. Naturally, they gather together lots of people who include such types as a person who played a piano for a relief fund and a young girl who sang at a concert. This particular girl was pointed out to me, and she had been behind barbed wire for three or four months without any sort of trial at all.
There are many similar cases which one could quote. In this clumsy fashion the Dutch are dealing with their own people in their own country. We, on the other hand, are asked to deal with an Empire problem, to provide the shooting men, the soldiers, the people who are

taking the risks, while in Holland there is a peculiar kind of army marching around looking after queer people who really ought to have been brought to trial months ago. I would mention to the Minister—I have already referred to it in the House before—that they are only trying about 30 people a week and when I was there a few weeks ago there were about 85,000 imprisoned. I know the Dutch Minister for Justice has said they are going to deliver justice to all these people, that they are working out a new code and setting up new courts and doing all kinds of things to at last clean up their country.
I would say to the Minister and to my friends in Holland—because those of us who have spoken tonight are friends of the Dutch, and we are concerned about the situation—that we feel that misguided action such as has been taken over the Indonesian situation may have repercussions throughout the length and breadth of the world. As the hon. Member for West Fife said, we shall discuss the Bretton Woods Agreements tomorrow. We shall discuss this situation in the next few days or before the Recess, but, unless we clean up this Indonesian problem before Christmas, how on earth can there be any rejoicing in those thousands of households in Britain whose lads are doing the fighting about which they were never consulted? As far as "good will to all men is concerned," this should include the Dutch. We should say to the Dutch, "If you cannot find ways and means of settling your Dominion troubles and of bringing together the people who call themselves Nationalists—those people who may disagree with the Dutch Government—we cannot settle them for you." The present Dutch Government is vastly different from that which they had in 1939, the Government that did not arm and did not prepare its services or defences, and did not do very much in rallying to fight Fascism, in the way we did in this country. We took the brunt long before Holland was invaded.

Lieut.-Colonel Mackeson: The hon. Gentleman is surely not suggesting that the rearmament programme was carried out by his party?

Mr. Walkden: I would say that the Conservatives have nothing to their credit so far as that is concerned. I have nothing on my conscience in relation to


it either in this war or the last. I did fight in the last war.

Lieutenant William Shepherd (Bucklow): Would the hon. Gentleman say whether he voted against the Army Estimates before the war?

Mr. Walkden: That is vastly removed from what we are debating. So far as the Dutch are concerned, and so far as mistakes have been made, the present situation is dynamically dangerous. We believe that now is the time to tackle the problem, and no excuses must be offered. We are clearing the Japanese out of Indonesia, and this trouble has been caused by a failure of understanding which is unpardonable. We believe that the mistakes that have been made can be adjusted by the efforts of my hon. Friend and his right hon. Friend, and the Government for which they speak.

8.51 p.m.

The Minister of State (Mr. Philip Noel-Baker): I know the House will be kind to me tonight, for I have to deal with a matter of great difficulty, which has been raised in a spirit of moderation and international friendship by the hon. Member for Maldon (Mr. Driberg), and I must carefully choose the words I use. I want both to reply to the Debate and to make some statements which, I hope, will be regarded as of importance. Owing to the many other duties which are falling on my shoulders at the present time, it has not been possible for me to give as many hours to the preparation of what I have to say as I should have liked.
I will begin, if I may, with my hon. Friend the Member for Doncaster (Mr. Walkden). He told us that the Dutch Government have not solved all the problems of the postwar epoch yet. I would repudiate, with some emphasis, what he said about their participation in the war. When they were attacked by Hitler they resisted with all the means in their power. I was in The Hague a fortnight before they were attacked, and had an opportunity of examining their defences and seeing what they had done. I venture to say that, with the resources at their command, they defended their land with the utmost gallantry.
The present Dutch Government is drawn, not entirely but almost entirely, from the ranks of the resistance movement. Whatever else they may have

done, no one can deny that, after their long martyrdom under the Nazis, they have, so far, done a wonderful job of reconstruction. But I would like to endorse one phrase used by my hon. Friend the Member for Doncaster: "The more of the get-together spirit we can have, the better for all concerned."
I should like to assure the hon. Member for West Fife (Mr. Gallacher) that some of my ancestors fought against King George 150 years ago, and, therefore, so far as that is concerned, I enter the Debate with no prejudice against those who rebel against established authority.

Mr. Gallacher: May I ask the right hon. Gentleman—

Mr. Noel-Baker: No, I have not got very long, and the hon. Gentleman took a long time. The hon. Member for West Fife and my hon. Friend the Member for Finsbury (Mr. Platts-Mills), if I understood them, came very near to suggesting that we ought never to have gone to Java at all, but ought to have left the Japanese, and the Japanese-trained Indonesian bands, in charge. If that is their suggestion, I do not think it will receive the approval of the House. Why did we go to Java? I do not need to repeat it again, I hope, to a House which has heard it repeatedly from the Prime Minister and from the Secretary of State, but I can summarise the main purposes. The purposes which it was necessary for us to carry out, and which I do not think a single hon. Member would repudiate, were to disarm and concentrate the Japanese forces, to rescue and bring home our prisoners of war, and—let us not forget it—to rescue the thousands of people whom the Japanese had placed in internment camps under appalling conditions and subject to cruelty of many kinds. The only agreements made with the Dutch Government, and with the French Government about Indo-China, which my hon. Friend the Member for Maldon also mentioned, were the ordinary civil affairs agreements made with all the Allied Governments for the taking over by them of the administration when the Allied Armies had finished their job.
So far as Indo-China is concerned, I understand that the tasks for which the British and Indian troops went in are now nearly completed. Practically all the Japanese have been disarmed, a


relatively small number remain to be dealt with, and it is hoped that they will all be dealt with by the end of the year. I for my part hope that our troops may be able to come away in the early future.

Mr. Driberg: Does that mean that the Annamese people are to be left with the French in control, without any guarantee of future independence?

Mr. Noel-Baker: What does the hon. Member mean by independence?

Mr. Driberg: Self-government.

Mr. Noel-Baker: Is it certain that the people of Indo-China are all united in desiring a complete changeover to independence, as my hon. Friend suggests? These are assumptions which tonight I cannot possibly admit from others, and which I could not allow myself to make.

Mr. Driberg: Ninety per cent. hate the French, and justly.

Mr. Noel-Baker: I want to come to what he said about Indonesia and Java, which is more important. He said that we were employing Japanese troops, that Indonesian villages had been burnt, and so on. Let me deal first with the use of Japanese troops. It is true that they have been used, in the official phrase, "defensively." What does that mean? It means that if internees, women and children—Dutch, Eurasian or other—are being attacked and subjected to murder or cruelty, as they very often have been by the Indonesian bands, then the Japanese are called on to repel those attacks. According to my information they have been used offensively only once, and I will give the House the exact details of what occurred.
On 6th December one of our battalions was ordered to reach and evacuate 500 starving internees, 140 of whom had already been carried off. They were met by heavily-fortified strong points. Our infantry could only have got to the rescue of those people with heavy loss of life unless we had been able to call on some artillery. There was no artillery to reduce the strong points, except Japanese. It was used in order to save our soldiers' lives and to rescue those people. Some of my hon. Friends, in particular the hon. Member for Finsbury, seemed to imply that no atrocities of any kind have been

committed by the Indonesian bands. I wish I could agree with him. I am not going to take the time of the House in describing atrocities, but I could do so at very considerable length. It was said that we had destroyed Indonesian villages by Typhoon rocket-planes. I have not heard of that. I have heard of the destruction of two radio stations by rocket, a very different matter. The targets were very well isolated, with no centres of population near them, and were very easy to destroy; in point of fact, the percentage of direct hits was very high. They were attacked because day by day and night by night they were pouring out the most inflammatory propaganda, inciting the Indonesian bands to acts of cruelty of many kinds.
It is said that villages were burned. I know of one case in which a village was burned, and again I will give the House the facts. An R.A.F. aircraft made a forced landing near a village. The crew were taken and murdered by brutal torture. Nothing was done against the population. They were cleared out of their village and the village was burned. I am not defending indiscriminate reprisals, but in these circumstances I find it hard to blame the commander on the spot.
Despite the obstructions and difficulties with which we have met, we have, in fact, made great progress towards our aims. We have disarmed and concentrated under our control a very large proportion of the Japanese forces in the island. We have set free and evacuated tens of thousands of the internees. There are still very many to be rescued—up to 200,000, mostly women and children. They are enduring starvation and all the familiar horrors of Japanese custody. To get them out, of course, we had to take military measures. We had to occupy Sourabaya for evacuation and for supply. Those who are resisting us are sometimes referred to in a facile phrase as "The Indonesian Army," and it is implied that they are obeying the orders of the Indonesian "Cabinet" and "Government." The resistance to the Allied Forces engaged on this relief, and the acts of terrorism which are going on, are the work, not of an army, but of so-called Indonesian youth movements, gangs of fanatical youths who were armed, and very largely trained, ideologically as well as militarily. by the Japanese. This so-


called Indonesian "Army" does not seek approval for its policy from any responsible Indonesian leader. It has shown itself capable of every outrage all over the Island, against the Allied prisoners of war and the internees. Moreover, all those who are known to sympathise with the Dutch and the British were at the mercy of these bloodthirsty youths, and in some areas in immediate danger of massacre, following on the starvation they had previously endured.
I venture to say that no one would urge that we should turn our backs on those people and say their fate is no concern of ours. If we do not help them no one else can, certainly not the Dutch, who have placed their troops and their ships at the Allies' disposal, and who have been extremely loyal in that regard. We must do everything we can to complete this work of rescue and relief. The first necessity is to remove them from the remaining camps and then, if we can, to get them away. That work is very difficult, so long as disorder is going on, and once you start on it, you arc compelled to do what the Secretary of State and the Prime Minister described as "restoring order." I know that the phrase "restoring order" has a sinister connotation in Colonial history. I know that any use of it justifiably arouses suspicion. I know it has been too often used as an excuse for the suppression of political aspirations by force. But what are the facts in this case? The suppression of the Indonesian terrorist groups will not in any way weaken the presentation of the Nationalist case by the Indonesian leaders in their negotiations with the Dutch. It will strengthen their case; and I have strong reason to believe —I ask the House to note this—that Dr. Sjahrir and his colleagues would welcome the suppression of the extremist elements whose outrages only prejudice their case, and who in fact, accept no orders from anybody. How can Dr. Sjahrir present the Indonesian case effectively under conditions in which the Armed Forces and the most important means of propaganda are in the hands of extremists who reject negotiations and call for further bloodshed? Anyone who has compared the declarations of Dr. Sjahrir and his colleagues with the wild and foolish outpourings from the radio stations of the so-called Indonesian "Army" will appreciate the extent of this disastrous division of the Indonesian people. The

savagery in word and action of the irreconcilables can only play into the hands of the more exacerbated and less conciliatory elements on the Dutch side.
Here I must say one word about the case for the Dutch. My hon. Friends spoke about the Indonesian people as being advanced, educated, capable, and so on. If that is so, some of the credit goes to the Dutch. The Dutch found these islands, when they first went there, in very primitive conditions. No one can deny that the reputation of the Dutch as a Colonial Power stood high in 1939. I venture to think that we must remember not only that record, not only what they have done in the study of anthropology, which is so vital to colonial progress, and which was so admirably advanced by the Dutch colonial administration and by the Universities of Holland, but that we must remember also the magnitude of the sacrifice that they made in the war. We must remember both the help which they gave us in Holland, when those four days mattered, for they had an effect on the ultimate outcome of Dunkirk, and their effort in the Far East, when they declared war on the Japanese without waiting for the Japanese to attack them, and when their submarines and their armed forces made a mighty contribution in holding up the pace of the Japanese advance.
I am confident that the well-known phenomenon, the colonial dieheard, who will not admit that the old days of easy and unchallenged ascendancy have gone and cannot return, will not prevail against men like the present Prime Minister of Holland, Professor Schemerhorn, and the Minister of Overseas Territories, Dr. Logemann, both of whom have been personally involved for several years in the promotion of movements for the more democratic and progressive administration of the Netherlands East Indies. The programme of the Indonesian Committee, of which the Prime Minister was chairman, was approved by all its Indonesian members and by the Communists. Dr. Schemerhorn's colleagues in the Dutch Cabinet know from first-hand experience in the Dutch Resistance Movement how intolerable repression and the denial of political rights can be, and I do not believe that that is their purpose in the East.
I ventured to describe the offer of 6th November as generous and far-reaching.


My hon. Friend, in his well-reasoned statement tonight, thought that I was too optimistic. Had I the time I would gladly analyse it further, but I think that the difference between us lies largely in what the Dutch propose about the Government of the whole Kingdom. They want now to implement the policy which was broadcast by the Queen of Holland in 1942. They aim at the realisation of those aspirations for a more liberal system by a process of evolution, by co-operation, and not by violence. They propose a partnership inside a Commonwealth or Kingdom of the Netherlands, which would include the Empire as a whole. They provide in Indonesia for a representative body with a substantial majority of Indonesian members, and, as my hon. Friend said, that body would be dealing primarily with internal matters.

Mr. Driberg: Under a Governor-General.

Mr. Noel-Baker: Yes, but where are the powers to lie? That is to be negotiated. This is a basis of discussion which the Dutch have put forward and which they ask the Indonesians to talk about. But the Dutch not only propose that; they propose a round table conference to decide on the methods whereby the Netherlands Indies, like other overseas Netherland territories, will participate in the Government of the whole Kingdom. I think that is where I differ from my hon. Friend, and that, I think, is where "The Times" correspondent, like my hon. Friend, got it wrong. What does the statement actually say?
Indonesia will become a full partner in the Kingdom organised as a Commonwealth of the participating territories. A round-table conference will propose how this will be done. Decisions, however, will be taken by the constitutional authorities of the Kingdom.
That means the authorities of the whole Kingdom. Unless I am mistaken, what is proposed is not at all Dominion status, but it is instead an advance towards a cooperative, federated Commonwealth of Holland and her territories overseas.

Mr. Driberg: But without the right of contracting out.

Mr. Noel-Baker: But surely that is all a matter for the negotiations, and for future historical development which we cannot now foresee. Canada, Australia and

New Zealand had no right of contracting out when self-government was first established by Acts of this Parliament. Let us not forget that until the war of 1914, Canada, Australia, New Zealand and South Africa had nothing to do with foreign affairs; they dealt with internal matters only.
This is a very far-reaching and liberal proposal for negotiations between those Indonesian Leaders who are fit to negotiate and the Dutch Government. It is easy to talk of independence. The leaders who claim to represent the country have still to prove that they can do so, and that they can exercise effective control; they have not done it up to now. They have still to prove that they can bring economic welfare to a country in danger of starvation, in a world where in far too many places, starvation exists or is coming very soon. The right plan now is to proceed on the road of co-operation and orderly evolution, and I beg hon. Members to consider how little reason we have yet to think that these Indonesian leaders could solidify the whole of the people for whom they claim to speak. Even in Java there is a tremendous mixture of races—Javanese, Sundanese, Mudanese, Chinese, Dutch, Eurasians, Arabs. This has to be taken into account. I am not saying that that is an argument against self-government, but it is one of the things that must be dealt with not by violence or by leaving the country to the bands trained by the Japanese, but by negotiations between responsible leaders and a responsible Dutch Government at home.
I was asked if I would encourage a meeting outside Java, perhaps in London. I was asked why it was that the Indonesians were not invited to meet at Singapore. To that the answer is simple. The meeting in Singapore was a military conference of the Allies to deal with questions concerned with the liquidation of the war with Japan, and there was no reason for Indonesian representatives to participate, and none of the items on the agenda could be said strictly to concern them. I venture to suggest to my hon. Friends that, before we think of conferences outside, and of referring the matter to the United Nations Organisation—and no one is likely to accuse me of wanting to keep important questions away from the United Nations Organisation—we had better see whether the negotiations which are now going on, which, on


Dutch initiative and with our support, have actually been begun, should not now be carried further.
It is not true that the Dutch have re fused to have meetings with the Indonesian leaders. Meetings have taken place. The difficulty has been the unwillingness of the Indonesian leaders to commit them selves to formal meetings. They do not seem confident of their powers to lead and to negotiate as authorised delegates. Therefore, however reasonable they may be in informal talks, they will not publicly, and as responsible delegates, declare what they would regard as a satisfactory basis of negotiations. The Dutch, as I said, took the initiative. I think it is up to the Indonesians now publicly to meet that initiative with counter proposals, if they want to make them, in a spirit of reasonable com promise. Dr. Van Mook is now on his way to the Netherlands to consult the Dutch Government—
It being a quarter past Nine o'Clock, the Motion for the Adjournment of the House lapsed, without Question put.
Motion made, and Question proposed, "That this House do now adjourn."—

Mr. Noel-Baker: I was saying that Dr. Van Mook is now on his way to the Netherlands to consult the Dutch Govern-

ment, and His Majesty's Government hope he will be given full authority by the Government at home, when he goes back to Indonesia, to use his unequalled experience of conditions and sentiments in the Dutch East Indies to meet the Indonesian case in most concrete and conciliatory terms. I think we must await the outcome of these consultations before we express any further opinion. In the meantime, we have the right to insist that there shall be the minimum possible delay in elaborating the statement of 6th November in more concrete terms and as a basis of negotiation. May I end with these words, which I commend to the attention of the House?
We now expect, and we demand, that the Dutch and Indonesians should sit down together to adjust their differences on a basis of concrete proposals from both sides without any further delay. The first essential is that both sides should appoint representatives with full powers, who are in no danger of being repudiated. In the meantime, His Majesty's Forces must continue to do what is necessary to ensure the safety of Allied prisoners of war and of the helpless internees.

Question put, and agreed to.

Adjourned accordingly at Seventeen Minutes past Nine o'Clock.